ConocoPhillips will sell its Cedar Creek Anticline properties, in North Dakota and Montana, for $1.05 billion to Denbury Resources, the companies announced today.
The property stretches over 86,000 net acres and produces an average of 13 thousand barrels of oil equivalent per day, down from about 15 million in 2011, according to ConocoPhillips documents. Denbury, based in Alvin, Texas, estimated average production to be about 11,00 barrels of oil equivalent per day.
While the land is located in southwestern North Dakota and eastern Montana, it does not include any of Conoco’s property in the prolific Bakken shale, according to the company.
The deal is expected to close during the first quarter of 2013.
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Denbury estimates the proved reserves in the Cedar Creek Anticline property of about 42 million barrels of oil equivalent, about 95 percent oil and 4 percent natural gas liquids. According to documents from ConocoPhillips, the property produced about 5 million cubic feet of natural gas per day and 15,000 barrels of oil and natural gas liquids per day in 2011.
“This disposition represents further optimization of our portfolio,” said Don Wallette, ConocoPhillips executive vice president of commercial, business development and corporate planning. “The transaction will allow us to focus our investments in North Dakota and Montana on our significant Bakken unconventional position.”
The Houston-based oil company owns about 626,000 net acres in the Bakken, a booming shale region in North Dakota and eastern Montana coveted for its rich oil production.
The Cedar Creek Anticline deal is the latest in ConocoPhillips’ ambitious asset sell off plan, which has sought to streamline the business by shedding billions of dollars in properties and assets.
Over the past year, Conoco has sold about $12 billion in assets.
Denbury expects to pay for the deal with the $1.3 billion in cash it has recieved from the sale of Bakken assets to ExxonMobil last year.