SM Energy to sell two non-core assets for $172.5m

US-based SM Energy has signed agreements to sell two separate packages of non-core assets together in a deal valued at $172.5m.

These property sales comprise the majority of non-core asset sales anticipated during this year, as announced in February.

As part of the sale, the first package consists of waterflood assets in New Mexico, while the second includes producing assets in North Dakota and Montana.

Net proved reserves associated with these assets for the end of last year totalled approximately 9.5 million barrels of oil equivalent (MMBOE), 87% oil and 13% natural gas, all of which were proven to be developed.

During the second quarter of this year, net production from these assets stood at 3,300 barrels of oil equivalent per day (Boe/d) and consisted of 82% oil and 18% natural gas.

Net acreage associated with these sales is approximately 79,000 acres.

SM Energy president and CEO Jay Ottoson said: “These transactions were well-timed and well-executed. We are committed to improving liquidity and debt metrics while managing our portfolio to focus on our highest return assets.

“Proceeds from these sales will be applied to the outstanding balance on our revolving credit facility and for general corporate purposes.”

The closings of these transactions are subject to the satisfaction of customary closing conditions and are expected in the third quarter of this year.

SM Energy said that either of these transactions may not close on the expected closing dates, possibly at all.