Sanchez Energy Announces Sale of Non-Core Assets in the Eagle Ford Shale
October 24 2016 - 4:36PM
Sanchez Energy Corporation (NYSE:SN) (“Sanchez Energy” or the
“Company”) today announced that the Company has executed a
definitive agreement with Carrizo Oil & Gas, Inc. (Nasdaq:CRZO)
(“Carrizo”) to sell certain non-core assets in the Eagle Ford
Shale.
Transaction Highlights:
- Cash consideration of $181 million upon closing, subject to
normal and customary closing adjustments;
- Approximately 15,000 net acres primarily located in La Salle
and McMullen Counties, TX;
- Net proved reserves of 6.9 MMBoe (90% developed); and
- Net production of approximately 3,000 barrels of oil equivalent
per day (“Boe/d”) (61% oil) from 112 gross (93 net) wells.
The divestiture of non-core assets is consistent
with the Company’s strategy to increase liquidity, improve its
balance sheet and focus on growth of the Catarina asset, where
Sanchez Energy has already identified over 1,350 high quality
drilling locations. The asset package that will be divested
is located in the eastern portion of the Cotulla area. With the
Company’s recent focus on the Catarina and Maverick areas of its
asset base, this strategic divestiture will provide the Company
with increased financial flexibility, including the ability to
expand its capital allocation in core areas.
MANAGEMENT COMMENTARY
“The transaction announced today is further
evidence of our dedication to improving our balance sheet while
maintaining our focus on core areas of operations,” said Tony
Sanchez, III, Chief Executive Officer of Sanchez Energy.
“Proceeds from the transaction, which is expected to close in
the fourth quarter 2016, are expected to enhance the Company’s
already strong liquidity position which, as of the end of the third
quarter 2016, totaled approximately $629 million, consisting of
approximately $329 million in cash and cash equivalents and an
undrawn bank credit facility with an elected commitment amount of
$300 million. We continue to pursue accretive asset
acquisitions and an organic growth strategy that stems from highly
economic wells at today’s commodity price level, our low cost
structure and from our extensive inventory of high quality drilling
opportunities.”
ABOUT SANCHEZ ENERGY
CORPORATION
Sanchez Energy Corporation (NYSE:SN) is an
independent exploration and production company focused on the
acquisition and development of unconventional oil and natural gas
resources in the onshore U.S. Gulf Coast, with a current focus on
the Eagle Ford Shale in South Texas where we have assembled over
200,000 net acres, and the Tuscaloosa Marine Shale. For more
information about Sanchez Energy Corporation, please visit our
website: www.sanchezenergycorp.com.
FORWARD-LOOKING STATEMENTS
This press release contains, and our officers and
representatives may from time to time make, forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. All statements, other than statements of
historical facts, included in this press release that address
activities, events or developments that Sanchez Energy expects,
believes or anticipates will or may occur in the future are
forward-looking statements, including statements relating to the
anticipated closing of the Transactions; and the Company’s plans
for development of the Catarina asset. These statements are
based on certain assumptions made by the Company based on
management's experience, perception of historical trends and
technical analyses, current conditions, anticipated future
developments and other factors believed to be appropriate and
reasonable by management. When used in this press release,
the words "will," "potential," "believe," "estimate," "intend,"
"expect," "may," "should," "anticipate," "could," "plan,"
"predict," "project," "profile," "model," "strategy," "future," or
their negatives, other similar expressions or the statements that
include those words, are intended to identify forward-looking
statements, although not all forward-looking statements contain
such identifying words.
Such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the
control of Sanchez Energy, which may cause actual results to differ
materially from those implied or expressed by the forward-looking
statements, including, but not limited to failure to continue to
produce oil and gas at historical rates, costs of operations,
delays, and any other difficulties related to producing oil or gas,
the price of oil or gas, marketing and sales of produced oil and
gas, estimates made in evaluating reserves, competition, general
economic conditions and the ability to manage our growth, our
expectations regarding our future liquidity, our expectations
regarding the results of our efforts to improve the efficiency of
our operations to reduce our costs and other factors described in
Sanchez Energy's most recent Annual Report on Form 10-K and any
updates to those risk factors set forth in Sanchez Energy's
Quarterly Reports on Form 10-Q. Further information on such
assumptions, risks and uncertainties is available in Sanchez
Energy's filings with the U.S. Securities and Exchange Commission
(the "SEC"). Sanchez Energy's filings with the SEC are
available on our website at www.sanchezenergycorp.com and on the
SEC's website at www.sec.gov. In light of these risks,
uncertainties and assumptions, the events anticipated by Sanchez
Energy's forward-looking statements may not occur, and, if any of
such events do occur, Sanchez Energy may not have correctly
anticipated the timing of their occurrence or the extent of their
impact on its actual results. Accordingly, you should not place any
undue reliance on any of Sanchez Energy's forward-looking
statements. Any forward-looking statement speaks only as of
the date on which such statement is made and Sanchez Energy
undertakes no obligation to correct or update any forward-looking
statement, whether as a result of new information, future events or
otherwise, except as required by applicable law.
COMPANY CONTACT:
Howard J. Thill
EVP & Chief Financial Officer
(713) 783-8000
General Inquiries: (713) 783-8000
www.sanchezenergycorp.com
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