QEP Resources, Inc. announced that its wholly owned subsidiary, QEP Energy Company, has entered into three definitive agreements to sell non-core oil and gas properties in the Midcontinent and Williston Basin for a combined purchase price of approximately $807 million, subject to customary purchase price adjustments.
Two of the agreements provide for the sale of oil and gas properties in the Cana-Woodford and Granite Wash plays in the Western Anadarko Basin in Texas and Oklahoma for a combined price of approximately $772 million (combined, the “Midcontinent Divestitures”). The Midcontinent Divestitures are expected to close on or before June 30, 2014, in each case subject to customary closing conditions and purchase price adjustments. The Midcontinent Divestitures contain an estimated 463 billion cubic feet equivalent of proved reserves as of December 31, 2013 and current production of approximately 109 million cubic feet equivalent per day (MMcfe/d) of which approximately 37% is liquids.
It's hard to tell from the most recent presentation how man acres are in west-central Williams County, but let's say it represents 10% of their total 116,000 net acres in the Bakken. That would be about 12,000 acres. $35 million / 12,000 acres prices moderately-good Bakken at $3,000. Some of it appears to be producing acreage.The third agreement provides for the sale of a non-core position in the western Williston Basin, known as “Fat Cat,” for a price of approximately $35 million and is expected to close in early June.
QEP has three plays in the Williston Basin:
- Fat Cat, west-central Williams, moderately good; will be sold
- South Antelope, eastern McKenzie County; very, very good acreage; about 45% of their acreage after Fat Cat sells
- Fort Berthold, the reservation; very, very good acreage; about 55% of their acreage after Fat Cat sells
Slide 7 of QEP's 1Q14 Operations Update. The presentation did not include net acreage in each of the plays (although I could have missed that). Two earlier presentations did not include an acreage breakout by play, and none of the three updates said anything about Fat Cat. In all presentations, one slide was devoted to each of the two other plays, South Antelope and Fort Berthold.