Bonanza Creek Energy sells assets in Mid-Continent US for $117m

Oil and natural gas firm Bonanza Creek Energy has divested its operations in the Mid-Continent US to an undisclosed company for $117m.

The assets acquired by the buyer include around 11,000 net acres in Lafayette and Columbia counties, primarily targeting the Cotton Valley formation.

As of 31 December last year, the operations had proved reserves of 12MMBoe.

During the first quarter of this year, the net production of the assets stood at 3,000Boed, while the company’s production volumes averaged 16.8MBoed.

Bonanza Creek Energy president and CEO Eric Greager said: “Our gratitude and deep thanks go to the Mid-Continent team for their tireless efforts and dedication to the strong performance of these operations.

“This transaction allows us to realise the value of the asset and turn our full attention to opportunities with greater long-term potential for Bonanza Creek.”

Following the completion of the sale, the company’s borrowing base remains unchanged at $192m.

Bonanza Creek’s net revenue for the first quarter increased to $64.2m from $52.6m in the corresponding period last year.

In January last year, the company, along with its subsidiaries, filed voluntary petitions under Chapter 11 of the US Bankruptcy Code to implement a pre-packaged plan of reorganisation.

The plan was aimed at reducing unsecured bond obligations by $867m.

In December last year, the company’s previously announced $746m merger with SandRidge Energy fell through.

The parties mutually terminated the deal after SandRidge’s Board of Directors concluded that it would not receive approval for the transaction.