Pioneer Natural Resources Announces Divestiture of Pioneer Pumping Services Assets and Long-Term Agreement with ProPetro
November 13 2018 - 8:30AM
Business Wire
Pioneer Natural Resources Company (NYSE:PXD) (“Pioneer”
or “the Company”) today announced that it has entered into an
agreement with ProPetro Holding Corp. (NYSE:PUMP)
(“ProPetro”) by which ProPetro will become a strategic long-term
service provider to Pioneer providing pressure pumping and related
services for up to 10 years. Under the agreement, Pioneer will
divest its pressure pumping assets (“PPS”) to ProPetro in exchange
for total consideration of $400 million comprised of $110 million
of cash and 16.6 million shares of PUMP common stock representing
approximately 17% ownership in ProPetro following issuance. The
transaction is expected to close during the fourth quarter of 2018,
subject to the satisfaction of customary closing conditions,
including regulatory approval.
Timothy L. Dove, Pioneer President and CEO, stated, “We are very
pleased to announce our agreement with ProPetro that provides
Pioneer with dedicated capacity from the leading pressure pumping
service provider in the Permian Basin. Their robust operational
track record aligns with our commitment to being the most
efficient, low-cost Permian operator. We have had a strong
relationship with the ProPetro team for many years, and this
contract solidifies their position as a key partner in our
development program. The long-term nature of this agreement will
benefit both companies.
“I would also like to personally thank all of the dedicated
employees of Pioneer Pumping Services. Their unrelenting commitment
to safety, efficiency and execution has underpinned our success in
the Permian Basin and we are excited to have them continue working
on Pioneer locations for years to come in our partnership with
ProPetro.”
Dale Redman, ProPetro co-founder and CEO, stated, “We could not
be more excited about the opportunity to expand our relationship
with Pioneer through this transformational transaction. The
combination of ProPetro and Pioneer Pumping Services will result in
the largest and most efficient pressure pumping provider in the
Permian Basin. As important is our strategic long-term service
agreement, and we look forward to continuing our close partnership
with Pioneer as they further develop their extensive resource base
in the Permian Basin.
“We are proud to welcome our new teammates from Pioneer Pumping
Services as the combination with ProPetro will create an unmatched
workforce in the industry. Finally, we want to thank our people,
our customers, our supply chain partners, and the Permian Basin
community for their continued long-term support of the Company and
our efforts.”
PPS assets include 8 fleets with 510,000 hydraulic horsepower
(HHP) and related facilities. Upon closing of the transaction,
ProPetro will have 28 fleets with 1,415,000 HHP operating in the
Permian Basin. This agreement is expected to increase ProPetro’s
scale in the Permian Basin and expand its leading operational track
record while allowing Pioneer to improve capital efficiency and
long-term cost competitiveness in its core operations.
Pioneer is a large independent oil and gas exploration and
production company, headquartered in Dallas, Texas, with operations
in the United States. For more information, visit www.pxd.com.
ProPetro is a Midland, Texas-based oilfield services company
providing pressure pumping and other complementary services to
leading upstream oil and gas companies engaged in the exploration
and production of North American unconventional oil and natural gas
resources. For more information concerning ProPetro, visit
www.propetroservices.com
Except for historical information contained herein, the
statements in this news release are forward-looking statements that
are made pursuant to the Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements and the business prospects of Pioneer are subject to a
number of risks and uncertainties that may cause Pioneer's actual
results in future periods to differ materially from the
forward-looking statements. These risks and uncertainties include,
among other things, volatility of commodity prices, government
regulation or action, the ability to obtain approvals from third
parties and negotiate agreements with third parties on mutually
acceptable terms, completion of planned divestitures and
litigation. These and other risks are described in the Company's
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and
other filings with the Securities and Exchange Commission. In
addition, the Company may be subject to currently unforeseen risks
that may have a materially adverse impact on it. Accordingly, no
assurances can be given that the actual events and results will not
be materially different than the anticipated results described in
the forward-looking statements. Pioneer undertakes no duty to
publicly update these statements except as required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20181113005286/en/
Pioneer Natural ResourcesInvestorsNeal Shah,
972-969-3900orTom Fitter, 972-969-1821orMichael McNamara,
972-969-3592orMedia and Public AffairsTadd Owens,
972-969-5760orRobert Bobo, 972-969-4020
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