Natural gas distributor Oneok Inc. has revealed that it is considering selling its oil and gas producing assets in order to reduce debt built up from its $1.35 billion acquisition of the natural gas liquids businesses from Koch.
In a statement, Oneok, one of the largest natural gas distributors in the US, said that it had entered into a process that may result in the sale of its oil and gas production companies by the third quarter 2005.
When we completed our acquisition of the natural gas liquids businesses from Koch, we indicated our intention to finance the transaction through a combination of available cash, issuance of long-term debt, settlement of our equity units in February 2006, and from the proceeds of the sale of less strategic assets, said David Kyle, Oneok chairman, president and CEO. Selling our oil and gas production operations is consistent with that strategy.
The company’s production segment owns, develops and produces natural gas and oil reserves in four fields in Oklahoma and Texas. This segment focuses on the acquisition and development of reserves, rather than exploratory drilling. Oneok plans to offer its producing businesses directly to a select group of prospective buyers.
This will allow us to focus our attention on our other businesses – natural gas distribution, gathering and processing, transportation and storage, energy services, natural gas liquids and our investment in Northern Border Partners, Kyle added.