EVEP Sells Utica Acres to Undisclosed Buyer
YOUNGSTOWN, Ohio -- EV Energy Partners and the EnerVest institutional partnerships it manages is selling 22,535 leasehold acres in three southeastern counties for $284.3 million, the Houston company announced Friday. The buyer was not disclosed.
The total acreage associated with the sale includes 22,535 acres in Guernsey, Harrison and Noble counties. Of that total, EV Energy Partners is selling 4,345 acres for approximately $56 million, net to its ownership interest. EV will retain its overriding royalty interests in these acres, the company said.
The transaction is expected to close by the end of the third quarter.
"This is a good first step in our revised Utica acreage sale process," said John B. Walker, chairman of EV Energy Partners in a statement. "The value of this sale averages $12,900 per acre. We look forward to announcing additional deals as they occur."
In its announcement, the company took note of the opening of the Utica East Ohio gas processing plant in Kensington, Columbiana County.
The UEO facility is processing more than 85 mmcf/d of wet gas, has a capacity of 200 mmcf/d, and throughput is expected to increase steadily over the next few weeks as additional wells are turned in line, the company said. With UEO and other processing facilities now available, more Utica wells are being turned in line, which is increasing the flow of gas through the Cardinal Gas gathering system. Increased volumes and cash flow are anticipated for the rest of this year and into 2014.
Said Mark Houser, president and CEO, "Our base business is running strong, and UEO is coming online as scheduled. We are pleased with our first Utica acreage sale and are gaining traction on other potential sales as we continue our marketing process."
Also Friday, EVEP announced its second-quarter financial results.
Production for the second quarter of 2013 was 11.1 Bcf of natural gas, 245 MBbls of crude oil and 526 MBbls of natural gas liquids, or 172.3 Mmcfe/day. This represents a 4 percent increase over the first quarter 2013 production of 165.2 Mmcfe/day and a 6 percent increase over second quarter 2012 production of 162.9 Mmcfe/day.
For the second quarter, the company reported a net income of $32.9 million, or 74 cents per basic and diluted weighted average limited partner unit outstanding. Included in net income were:
- $30.3 million of unrealized gains on commodity and interest rate derivatives,
- $0.5 million of non-cash realized losses related to terminated interest rate swaps,
- $0.9 million of dry hole and exploration costs,
- $2.8 million of non-cash leasehold impairment charges,
- $0.2 million of non-cash deferred income taxes, and
- $4.3 million of non-cash costs contained in general and administrative expenses.
For the first quarter of 2013, EVEP reported a net loss of $46.6 million, or $1.08 per basic and diluted weighted average limited partner unit outstanding. For the second quarter of 2012, EVEP reported net income of $15.0 million, or 35 cents and 34 cents per basic and diluted weighted average limited partner unit outstanding, respectively.
SOURCE: EV Energy Partners.
Published by The Business Journal, Youngstown, Ohio.
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