Pioneer Natural Resources sells interest in Wolfcamp Shale assets

US-based Pioneer Natural Resources has completed the divestment of its 40% interest in the horizontal Wolfcamp Shale play in the southern portion of the Spraberry Trend Area Field for about $1.7bn, to Sinochem Petroleum USA, a subsidiary of Sinochem Group.

Pioneer has about 207,000 net acres in the Spraberry Trend Area Field, of which Sinochem has acquired 82,800 net acres in the field.

As part of the deal, Sinochem has paid $631m to the company, with $522m being the upfront portion of the transaction price and $109m the company’s 40% share of net expenditures in the joint interest area.

Sinochem plans to pay the remaining $1.2bn after carrying 75% of Pioneer’s share, which includes future drilling and facility costs.

It will receive its share from the joint interest area, which is flowing about 10,000 barrels oil equivalent per day.

Pioneer will remain the operator of the lease hold and conduct all leasing, drilling, operations and marketing activities in the joint interest area.

The company holds current working interests in all horizons shallower than the Wolfcamp horizon.

The joint interest area includes defined portions of Upton, Reagan, Irion, Crockett and Tom Green counties in Texas.

Pioneer has drilled and completed 39 horizontal wells in the Wolfcamp Shale joint interest area as of 31 December 2012, of which 22 wells are in the production stage, while four additional wells are flowing back.

Sinochem is a Chinese conglomerate, which has businesses in energy, agriculture, chemicals, real estate and financial services.

---

Image: Pioneer Natural Resources has completed the divestment of 40% interest in the Spraberry Trend Area Field in the US. Photo: Courtesy of Pioneer Natural Resources.