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Riviera Resources Inc. signed an agreement to sell its interest in East Texas properties to an undisclosed buyer for a contract price of $34 million, subject to closing adjustments.
The properties to be sold consist of about 750 wells located in the Personville Field in East Texas with average third-quarter net production of roughly 28 million cubic feet equivalent per day. Proceeds from the sale are expected to be added to cash on the company’s balance sheet.
So far this year, Riviera has gradually been monetizing assets from the multibasin portfolio it inherited through its spinoff from Linn Energy in 2018.
“I am pleased to announce this sale not only because it generates additional proceeds that can be returned to shareholders, but our capability to resourcefully maximize value given the current market environment,” David Rottino, president and CEO of Riviera, said in a statement. “In 2019, we generated over $500 million in proceeds through strategic monetizations, and returned over $400 million of capital to shareholders.”
After closing the transaction, which is expected to occur in first-quarter 2020, Riviera will continue to own upstream assets primarily located in North Louisiana and Midcontinent regions. Additionally, the Houston-based company owns Blue Mountain Midstream LLC, a midstream company centered in the core of the Merge play in the Anadarko Basin.
Riviera expects to close its pending divestitures of properties located in the Overton Field in East Texas and the Drunkards Wash Field in the Uinta Basin. The company plans to use existing cash and proceeds from assets sales to return capital to shareholders, which may include share repurchases.
In his statement, Rottino also added that Riviera will continue to find ways to return capital to shareholders using existing cash and proceeds from announced transactions.
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