Exco Sells US Shale Assets for $300mn

US Exco Resources has announced the $300mn sale of south Texas oil and gas assets to Venado Oil and Gas, an affiliate of New York-based private equity firm KKR. The price is subject to customary closing conditions and adjustments based on an effective date of January 1, 2017, Exco said April 10.

The properties to be divested include acreage in Zavala, Frio and Dimmit counties in Texas, which in December produced about 4,100 barrels of oil equivalent/day, of which about 10% is gas. The company expects the transaction to close in June 2017.

Exco said the sale was an "important step in its portfolio optimisation initiative and will improve its financial flexibility." The proceeds will help to fund drilling and development of its core Haynesville and Bossier shale assets in north Louisiana and east Texas and for other general corporate purposes.

After completion, the borrowing base will be $100mn and the next borrowing base redetermination under the credit agreement is set to occur in November 2017.

William Powell