Antero Resources announced that it has entered into an agreement to sell all of its exploration and production assets in the Arkoma Basin along with associated commodity hedges to Vanguard Natural Resources, LLC
for $445 million in cash. The transaction is expected to close by the end of the second quarter 2012 with an effective date of April 1, 2012.
The assets consist of 66,000 net acres in the Woodford Shale play and 5,300 net acres in the Fayetteville Shale play, located in the Arkoma Basin in Oklahoma and Arkansas, respectively. The assets contain an estimated 251 Bcfe of proved developed reserves as of March 31, 2012 and are currently producing 76 MMcfed from 833 gross wells. Antero operates 134 of the producing wells, all in the Woodford Shale play.
Following the closing of the transaction, Antero’s estimated 988 Bcfe of proved developed reserves as of March 31, 2012 would have been reduced to 737 Bcfe to give pro forma effect to the disposition. Antero’s March 31, 2012 proved developed reserves are internally generated by Antero’s reserve engineers using SEC pricing as of March 31, 2012 and have not been audited by Antero’s third party reserve engineers. Additionally, Antero’s $1.1 billion of net debt as of March 31, 2012 would have been reduced to $650 million, pro forma for the closing of the transaction. Upon closing, Antero expects the borrowing base under its current credit facility to be reduced by approximately $300 million from $1.55 billion to $1.25 billion, and the Company plans to reduce its lender
commitments to $750 million.
Antero Resources Chairman and CEO Paul M. Rady commented, “The Arkoma asset sale allows Antero to redeploy capital to its high growth Appalachian shale projects including the Marcellus Shale, Upper Devonian Shale and Utica Shale plays where we are focused on the development of liquids-rich natural gas resources. Following the closing of the transaction, our only remaining non-Appalachian asset is our Piceance Basin project which also produces liquids-rich gas from Mesaverde Formation tight sands.”