LINN Energy sells assets in US for $2.3billion

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Oil and gas partnership LINN Energy has sold part of its assets in the US for $2.3billion.

The US oil firm sold its assets in the Texas Panhandle and western Oklahoma to privately held institutional affiliates of EnerVest.

The company revealed its plans to sell its entire position in the Granite Wash and Cleveland plays on today.

LINN also announced it had signed a definitive agreement with Fleur de Lis Energy, LLC to sell its Wolfberry positions in Ector and Midland counties in the Permian Basin in the West of Texas and southeastern New Mexico, for a contract price of $350million.

The proceeds from all of these sales are expected to finance the company’s $2.3billion acquisition of assets from Devon Energy Corporation.

Mark E. Ellis, chief executive LINN Energy, said: “One of our goals for 2014 was to maximize value for our Midland Basin and Granite Wash assets in order to reduce the capital intensity and decline rate within our portfolio.

“We believe today’s announcements largely accomplish this goal.

“When considered in light of the accretive acquisitions and trades we’ve announced this year, we are very excited about our business as we move into 2015.”

Sales of the Granite Wash and Cleveland properties sold include approximately 145,000 net acres, 195 MMcfe (millions of cubic feet equivalent), 755 Bcfe (billions of cubic feet equivalent) of year-end 2013 proved reserves and related midstream facilities.

LINN is currently running a four-rig drilling programme and has planned to spend approximately $210million of capital on these assets in 2014.

The Permian Basin properties sold include approximately 7,200 net acres, 4.6 MBoe/d (million barrels of oil) of current production and 19 MMBoe of year-end 2013 proved reserves.

LINN is running a two-rig vertical drilling program and has planned to spend approximately $95 million of capital on these assets in 2014.

Following the closing of this transaction, LINN will have remaining production of approximately 8.0 MBoe/d and approximately 6,600 net acres in the Midland Basin that is prospective for horizontal Wolfcamp drilling.