US-based natural gas producer Chesapeake Energy has sold its Northern Eagle Ford Shale and Haynesville Shale assets, worth about $1bn, to EXCO Operating Company, a subsidiary of EXCO Resources.
As per the agreements, EXCO, in the Northern Eagle Ford Shale, will acquire around 55,000 net acres in Zavala, Dimmit, La Salle and Frio counties, Texas.
The deal will include nearly 120 producing wells with average net daily production of about 6,100 barrels of oil equivalent during the month of May.
In the Haynesville Shale, EXCO will buy Chesapeake’s operated and non-operated interests in almost 9,600 net acres in Desoto and Caddo parishes, Louisiana.
The transaction will include 11 units operated by Chesapeake and 42 units operated by EXCO.
Average net daily production from the Haynesville properties to be sold was approximately 114 million cubic feet of natural gas equivalent during the month of May.
Chesapeake Energy chief executive officer Doug Lawler said the announcement brings the company’s year-to-date asset sales signed or closed to about $3.6bn, which, combined with forecasted net operating cash flow will help the company fully fund its 2013 capital expenditure budget.
"Additional asset sales contemplated for later this year may reduce long-term debt and further enhance our financial liquidity," Lawler added.
EXCO will pay 90% of the proceeds upon closing the deal, which is subject to certain closing conditions and is expected to close in the third quarter of 2013.