Noble Energy to sell midstream assets to Unit Petroleum

Noble Energy has agreed to sell certain oil and natural gas assets in western Oklahoma and the Texas Panhandle to Unit Petroleum Company for $617m in cash.

The acquired assets include 84,000 net acres primarily in the Granite Wash, Cleveland, and Marmaton plays in western Oklahoma and the Texas Panhandle, with about 900 producing wells.

The estimated proved reserves of the properties is 44 million barrels of oil equivalent (MMBoe) and the estimated average daily net production is 10,000 barrels of oil equivalent.

Currently, net daily production from these assets stands at nearly 60 million cubic feet equivalent per day with 65% natural gas, 27% natural gas liquids, and 8% oil.

Unit said the net proved reserves of the properties were about 250 billion cubic feet equivalent while 95% of the subject acreage is held by production.

Unit Petroleum Company president and CEO Larry D. Pinkston said that this is an important growth step for the company and benefits all three of its business segments.

"For our upstream business segment, it will more than double our acreage in the Granite Wash Texas Panhandle core area, a highly prolific liquids-rich fairway in the Anadarko Basin," Larry added.

Unit plans drilling activity in the acquired properties over the next 12 to 18 months using seven rigs from its contract drilling segment, and would operate the acquired gathering systems by replacing existing third party processing contracts beginning in 2015.

The deal will add about 25,000 net acres to the company’s Granite Wash core area in the Texas Panhandle.