Sundance Energy Australia Limited (ASX: SEA) (NASDAQ: SNDE) (“Sundance” or the “Company”), a U.S. onshore oil and gas exploration and production company focused in the Eagle Ford in South Texas, today announced that it had entered into a definitive agreement to sell its assets in Dimmit County, TX (the “Assets”) for a purchase price of US$29.5 million, subject to customary adjustments at closing.
Image: Onshore drilling. Photo: courtesy of Zbynek Burival on Unsplash.
The Assets comprise 19 gross producing wells on ~6,100 net acres and contributed 1,051 boepd in average daily sales volumes for the first quarter of 2019. The sale is anticipated to close prior to the end of September 2019.
In anticipation of this transaction sale, the Company’s recently announced ~40% increase to its borrowing base facility did not include any reserves associated with the Assets in the calculation of the borrowing base. As such, the borrowing base will remain unchanged upon the close of the sale. Additionally, the Company’s previously released public guidance excluded any contribution from the Assets beginning in May 2019.
Sundance’s Chief Executive Officer and Managing Director, Eric McCrady, commented, “The impending successful sale of our Dimmit assets at an attractive price will only serve to add to the Company’s already strong liquidity position. The cash consideration, in addition to the existing availability under our borrowing base, provides an ample liquidity cushion while we work towards reaching free cash flow generation in the second half of the year.”
Source: Company Press Release