WPX to receive approximately $350 million in net proceeds for its 25%
interest in Oryx II
A subsidiary of WPX Energy (NYSE: WPX) and its joint venture partner in
the Oryx II pipeline have signed agreements to sell the project. Closing
is expected in the second quarter.
Upon close, WPX expects net proceeds of approximately $350 million for
its 25 percent equity interest after adjusting for debt financing
related to Oryx II.
In addition, WPX expects to save approximately $40 million in planned
equity investments for the balance of the year due to the sale.
WPX is retaining its contractual rights as a shipper on Oryx and plans
to deploy proceeds from the transaction to its balance sheet.
WPX also is reevaluating the timetable for its plan to return capital to
shareholders, originally targeted for 2021. Projected free cash flow
from WPX’s operations in 2019 may accelerate action, with a decision
expected in the latter half of this year.
“WPX’s opportunistic approach continues to create significant value for
shareholders and generate handsome returns on our capital employed,”
said Rick Muncrief, chairman and chief executive officer.
“We secured flow assurance and ownership interests in critical midstream
projects in the Delaware Basin before constraints ever occurred. That
strategy also has protected the pricing for our production in the
basin,” said Muncrief.
The Oryx system is a regional crude oil pipeline transport network that
supports the Northern Delaware Basin. It consists of more than 500 miles
of pipe that include a significant presence in the Stateline area of
Texas and New Mexico. Oryx II is one component of the overall system.
The Oryx II transaction is WPX’s second midstream monetization this
year. WPX already closed on the previously announced sale of its 20
percent equity interest in WhiteWater Midstream’s Agua Blanca natural
gas pipeline system. WPX remains a shipper on that system, as well.
WPX invested approximately $125 million in its equity positions in the
Oryx and Whitewater midstream systems, primarily in 2017 and 2018. The
investments generated approximately half of a billion dollars in net
proceeds this year, pending the close of the Oryx II sale.
“I extend our sincere congratulations to the Oryx management team and
their financial sponsors at Quantum Energy Partners and Post Oak Energy
Capital for their highly successful project,” Muncrief added. “We look
forward to working with the new owners as a shipper on this valuable
infrastructure.”
About WPX Energy, Inc.
WPX is an independent energy producer with core positions in the Permian
and Williston basins. WPX’s production is approximately 80 percent
oil/liquids and 20 percent natural gas. The company also has an
infrastructure portfolio in the Permian Basin. Visit www.wpxenergy.com for
more information.
This press release includes “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995. All
statements, other than statements of historical facts, included in this
press release that address activities, events or developments that the
company expects, believes or anticipates will or may occur in the future
are forward-looking statements. Such statements are subject to a
number of assumptions, risks and uncertainties, many of which are beyond
the control of the company. Statements regarding future drilling
and production are subject to all of the risks and uncertainties
normally incident to the exploration for and development and production
of oil and gas. These risks include, but are not limited to, the
volatility of oil, natural gas and NGL prices; uncertainties inherent in
estimating oil, natural gas and NGL reserves; drilling risks;
environmental risks; and political or regulatory changes. Investors
are cautioned that any such statements are not guarantees of future
performance and that actual results or developments may differ
materially from those projected in the forward-looking statements. The
forward-looking statements in this press release are made as of the date
of this press release, even if subsequently made available by WPX Energy
on its website or otherwise. WPX Energy does not undertake and
expressly disclaims any obligation to update the forward-looking
statements as a result of new information, future events or otherwise.
Investors are urged to consider carefully the disclosure in our
filings with the Securities and Exchange Commission, available from us
at WPX Energy, Attn: Investor Relations, P.O. Box 21810, Tulsa,
Okla., 74102, or from the SEC’s website at www.sec.gov.
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