Contango Announces Sale of Certain Non-Core Assets
April 02 2018 - 9:41AM
Contango Oil & Gas Company (NYSE American:MCF) announced
today that it has sold its operated Eagle Ford Shale assets located
in Karnes County, Texas to an independent oil and gas company for
$21 million. The divestiture closed on Wednesday, March 28
and included approximately 1,500 gross (1,050 net) acres.
Production from the sold assets was approximately 123 barrels of
oil equivalent (Boe; 95% oil) per day. The cash proceeds from
this transaction will be used to pay down outstanding borrowings
under our revolving credit facility and for general corporate
purposes, including development of our Southern Delaware Basin
position.
Allan D. Keel, the Company’s President and Chief Executive
Officer, said “This asset accounted for a little over 1% of our
current production and only 2% of our proved developed year-end SEC
reserves. As a result, no unscheduled adjustment to the borrowing
base under our credit facility was required. The sale
represents an acceleration of value as it was not likely to be
developed by us in the near future as we continue to focus on our
Southern Delaware Basin position. Due to the excellent rates of
return expected from the Delaware Basin in this price and cost
environment, and our conservative philosophy on funding our capital
program, we were pleased to be able to obtain additional liquidity
to continue to develop that acreage.”
Contango Oil & Gas Company is a Houston,
Texas based, independent energy company whose business is to
maximize production from its shallow offshore Gulf of Mexico
properties and onshore properties in Texas and Wyoming, and to use
that cash flow to explore, develop, exploit, produce and acquire
crude oil and natural gas properties in the Texas and Rocky
Mountain regions of the United States. Additional information is
available on the Company's website at http://www.contango.com.
This press release contains forward-looking
statements regarding Contango that are intended to be covered by
the safe harbor "forward-looking statements" provided by the
Private Securities Litigation Reform Act of 1995, based on
Contango’s current expectations and includes statements regarding
acquisitions and divestitures, estimates of future production,
future results of operations, quality and nature of the asset base,
the assumptions upon which estimates are based and other
expectations, beliefs, plans, objectives, assumptions, strategies
or statements about future events or performance (often, but not
always, using words such as "expects", “projects”, "anticipates",
"plans", "estimates", "potential", "possible", "probable", or
"intends", or stating that certain actions, events or results
"may", "will", "should", or "could" be taken, occur or be
achieved). Statements concerning oil and gas reserves also may be
deemed to be forward looking statements in that they reflect
estimates based on certain assumptions that the resources involved
can be economically exploited. Forward-looking statements are based
on current expectations, estimates and projections that involve a
number of risks and uncertainties, which could cause actual results
to differ materially from those, reflected in the statements. These
risks include, but are not limited to: the risks of the oil and gas
industry (for example, operational risks in exploring for,
developing and producing crude oil and natural gas; risks and
uncertainties involving geology of oil and gas deposits; the
uncertainty of reserve estimates; the uncertainty of estimates and
projections relating to future production, costs and expenses;
potential delays or changes in plans with respect to exploration or
development projects or capital expenditures; health, safety and
environmental risks and risks related to weather such as hurricanes
and other natural disasters); uncertainties as to the availability
and cost of financing; fluctuations in oil and gas prices; risks
associated with derivative positions; inability to realize expected
value from acquisitions, inability of our management team to
execute its plans to meet its goals, shortages of drilling
equipment, oil field personnel and services, unavailability of
gathering systems, pipelines and processing facilities and the
possibility that government policies may change or governmental
approvals may be delayed or withheld. Additional information on
these and other factors which could affect Contango’s operations or
financial results are included in Contango’s other reports on file
with the Securities and Exchange Commission. Investors are
cautioned that any forward-looking statements are not guarantees of
future performance and actual results or developments may differ
materially from the projections in the forward-looking statements.
Forward-looking statements are based on the estimates and opinions
of management at the time the statements are made. Contango does
not assume any obligation to update forward-looking statements
should circumstances or management's estimates or opinions change.
Initial production rates are subject to decline over time and
should not be regarded as reflective of sustained production
levels.
|
|
|
Contact: |
|
|
Contango Oil & Gas Company |
|
|
E.
Joseph Grady – 713-236-7400 |
|
Sergio Castro – 713-236-7400 |
Senior Vice President and Chief Financial Officer |
|
Vice
President and Treasurer |
Contango Oil and Gas (AMEX:MCF)
Historical Stock Chart
From Mar 2024 to Apr 2024
Contango Oil and Gas (AMEX:MCF)
Historical Stock Chart
From Apr 2023 to Apr 2024