Ovintiv Inc. recently closed its previously announced Eagle Ford asset sale, officially marking the company’s exit from the South Texas shale play.
The roughly $880 million in proceeds, combined with those recently received from the Duvernay asset sale, will be applied toward its goal to cut debt by around 35% to $4.5 billion. The company also announced on May 19 it had issued notice to fully redeem outstanding 2021 and 2022, which represents approximately $1.1 billion of debt retirement for Ovintiv.
“Today’s Eagle Ford asset sale continues our track record of delivery and allows us to meaningfully accelerate debt reduction,” Ovintiv CEO Doug Suttles said in a statement in a May 19 company release.
In addition to “strong free cash flow generation,” Suttles now expects Ovintiv to reach the $4.5 billion debt reduction goal by year-end instead of the previously targeted first half of 2022, he said.
“Our priorities today are clear—reduce debt, maintain scale, drive efficiencies, and return cash to shareholders,” Suttles added.
The buyer of the Ovintiv Eagle Ford assets, Validus Energy, is a privately owned E&P company led by Felix Energy founder Skye Callantine, who previously built and sold roughly $7 billion of assets over an 8-year period under the Felix Energy platform.
Validus Energy is financially backed by equity commitments from Pontem Energy Capital, other institutions, and private investors, according to its website.
BMO Capital Markets and Citigroup Global Markets Inc. was Ovintiv’s financial advisers for the Eagle Ford transaction and Davis Graham & Stubbs LLP provided legal counsel.
Recommended Reading
Seatrium Awarded Contract for FPSO Bound for Guyana’s Stabroek
2024-05-17 - The topsides fabrication and integration contract will be for the FPSO Jaguar, bound for the Whiptail Field in the Stabroek block offshore Guyana for Exxon Mobil.
Third Suriname Find for Petronas, Exxon Could Support 100,000 bbl/d FPSO
2024-05-17 - A recent find offshore Suriname in Block 52 by Petronas and Exxon Mobil could support a 100,000 bbl/d FPSO development, according to Wood Mackenzie.
US Drillers Add Oil, Gas Rigs for First Time in Four Weeks: Baker Hughes
2024-05-17 - The oil and gas rig count rose by one to 604 in the week to May 17.
BPX Looks to Ramp US Production Over 60% by 2030
2024-05-16 - BPX Energy is looking to boost its U.S. production over 60% by 2030 as it considers bringing online a fourth processing facility in the Permian by mid-year 2025, Clark Edwards, the company’s vice president of development, said during SUPER DUG in Fort Worth.
Empire Petroleum’s Williston Drilling Program Identifies New Zones
2024-05-16 - Empire Petroleum provided updates on its Williston Basin development drilling program in its first quarter 2024 earnings results.