Denbury Resources to sell non-core assets for $155m

Oil and natural gas firm Denbury Resources has entered a definitive agreement to sell non-core assets in the US to Petro Harvester Oil and Gas for $155m.

The assets being sold are primarily located in central and southern Mississippi and southern Louisiana. The properties have proved reserves of approximately 6.2 million barrels of oil equivalent as of 30 December 2010, 93% of which is oil.

US-based Denbury said its 2012 annual production guidance assumed production from the assets of about 1,400 barrels of oil equivalent per day.

The sale includes approximately 138 operated wells in 29 producing oil and gas fields, and will close by the end of February 2012. The proceeds from this transaction will be used by Denbury to partially pay down its credit facility.

Denbury president and CEO Phil Rykhoek said the sale demonstrates execution on a portion of the company’s 2012 plan, which would allow it to fund its $1.35bn capital investment programme and stock repurchases without incurring significant incremental debt. Denbury also continues to divest its non-operated interests in the Greater Aneth oilfield in the US state of Utah.

Petro Harvester president and COO Jim Sinclair said the company continues its strategy of purchasing well-established, long-life, oil-weighted fields, with opportunities for operational improvements to increase production and reserves.

Petro Harvester is an oil-focused exploration and production firm formed by TPG Capital to buy mature producing assets in North America.