Final 2,280 BOEPD sold for $110 million

Halcon Resources (ticker: HK) announced the sale of its non-operated Williston basin assets today, completing its shift to a pure-play Delaware operator.

Halcon currently holds interests in several non-operated Williston basin properties that were left over from its Williston sale earlier this year. Halcon’s share of production from these assets is currently about 1,891 BOPD, 1,931 Mcf/d and 65 BPD of natural gas liquids. Halcon plans to divest these properties in two separate sales to undisclosed private companies. One company will pay Halcon $104 million in cash, while the second will pay $6 million.

With current total production of about 2,280 BOEPD, this transaction has an implied valuation of $48,335 per flowing BOE. This is almost the exact same valuation as Halcon received when it sold its operated Bakken assets, when the company received $48,276 per flowing BOE.

Halcon expects the sales to close within 60 days. The proceeds from this sale will be used to reduce Halcon’s current liabilities, and the company’s revolving credit facility should fall to $100 million upon closing of the sale.

Transition from Eagle Ford and Bakken to Delaware in nine months

This sale marks the end of a nine-month transformation for Halcon Energy. At the beginning of 2017, Halcon was an operator with properties in the Bakken and Eagle Ford. In January, however, the company announced its entry into the Delaware basin, acquiring about 35,800 acres in Pecos and Ward Counties. With a total purchase price of about $855 million, this transaction marked a turning point for Halcon.

Halcon immediately began to execute on this transformation, announcing the sale of its Eagle Ford assets simultaneously with its Delaware basin announcement. The company received $500 million in cash for the properties, which were producing 5,600 BOEPD and held 35.1 MMBOE of reserves.

In July, Halcon made a second major move, divesting its operated Williston assets. Halcon sold about 29,000 BOEPD of production, representing the majority of its total production. Bruin E&P Partners, a portfolio company of Arclight Capital Partners, paid Halcon $1.4 billion for the assets.

These two transactions have left Halcon with about 41,520 net acres in the Delaware basin, where the company is producing about 7,400 BOEPD. The company plans to spud 21 gross wells on its acreage in 2017, and has begun bringing the first wells on production.

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