HOUSTON, June 13, 2019 /PRNewswire/ -- Callon Petroleum
Company (NYSE: CPE) ("Callon" or "we" or "our") announced today
that it closed on the previously announced divestiture of non-core
assets in the southern Midland
Basin to Sequitur Permian, LLC for net cash proceeds of
$245 million, subject to customary
post-closing adjustments. Net cash proceeds were adjusted for an
effective date of January 1, 2019,
and do not include potential contingent consideration payments of
up to $60 million based on West Texas
Intermediate average annual pricing over a three-year period.
Joe Gatto, President and Chief
Executive Officer commented, "We remain on a clear path to attain
the various objectives we have outlined for investors. This
transaction is a meaningful step forward on our deleveraging goals
which will also be advanced by our cash flow generation in coming
quarters."
Updated 2019 Guidance
Callon is updating its full year guidance to account for the
impact of this divestiture and a previously announced acreage trade
involving producing properties in Midland
County. In addition, management is lowering its estimates
for operational capital expenditures to reflect realized
efficiencies and cost reductions.
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Previous Full
Year
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Updated Full
Year
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2019
Guidance
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2019
Guidance
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Total production
(Mboe/d)
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39.5 -
41.5
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38.0 -
39.5
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% oil
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77% - 78%
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78% - 79%
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Income statement
expenses (per Boe)
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LOE, including
workovers
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$5.50 -
$6.50
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$5.50 -
$6.50
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Production taxes,
including ad valorem (% unhedged
revenue)
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7 %
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7 %
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Adjusted
G&A: cash component (a)
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$2.00 -
$2.50
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$2.00 -
$2.50
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Adjusted
G&A: non-cash component (b)
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$0.50 -
$1.00
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$0.50 -
$1.00
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Cash
interest expense (c)
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$0.00
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$0.00
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Effective income tax
rate
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22%
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22%
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Capital
expenditures ($MM, accrual basis)
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Total operational
(d)
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$500 -
$525
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$495 -
$520
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Capitalized interest
and G&A expenses
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$100 -
$105
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$100 -
$105
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Net operated
horizontal wells placed on production
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47 - 49
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47 - 49
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a)
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Excludes stock-based
compensation and corporate depreciation and amortization. Adjusted
G&A is a non-GAAP financial measure; see our most recent
earnings release for a reconciliation of G&A expense on a GAAP
basis to Adjusted G&A expense.
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b)
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Excludes certain
non-recurring expenses and non-cash valuation adjustments. Adjusted
G&A is a non-GAAP financial measure; see our most recent
earnings release for a reconciliation of G&A expense on a GAAP
basis to Adjusted G&A expense.
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c)
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All cash interest
expense anticipated to be capitalized.
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d)
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Includes facilities,
equipment, seismic, land and other items. Excludes capitalized
expenses.
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About Callon Petroleum Company
Callon Petroleum Company is an independent energy company
focused on the acquisition and development of unconventional
onshore oil and natural gas reserves in the Permian Basin in
West Texas.
Cautionary Statement Regarding Forward Looking
Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Forward-looking
statements include all statements regarding wells anticipated to be
drilled and placed on production; future levels of drilling
activity and associated oil and gas production; Callon's 2019
production guidance, taxes and capital, operating and G&A
expenditure forecasts; and the implementation of Callon's business
plans and strategy, as well as statements including the words
"believe," "expect," "plans," "may," "will," "should," "could," and
words of similar meaning. These statements reflect Callon's current
views with respect to future events and financial performance based
on management's experience and perception of historical trends,
current conditions, anticipated future developments and other
factors believed to be appropriate. No assurances can be given,
however, that these events will occur or that these projections
will be achieved, and actual results could differ materially from
those projected as a result of certain factors. Any forward-looking
statement speaks only as of the date on which such statement is
made and Callon 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.
Some of the factors which could affect Callon's future results and
could cause results to differ materially from those expressed in
Callon's forward-looking statements include the volatility of oil
and natural gas prices, ability to drill and complete wells,
operational, regulatory and environment risks, cost and
availability of equipment and labor, Callon's ability to finance
Callon's activities and other risks more fully discussed in
Callon's filings with the Securities and Exchange Commission,
including Callon's Annual Reports on Form 10-K and Quarterly
Reports on Form 10-Q, available on Callon's website or the SEC's
website at www.sec.gov.
Contact Information
Mark Brewer
Director of Investor Relations
Callon Petroleum Company
ir@callon.com
1-281-589-5200
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SOURCE Callon Petroleum Company