Oil and natural gas operator U.S. Energy Corp. (USEG) completed a series of non-core asset divestitures, according to a Jan. 10 press release.

USEG’s divestiture highlights include:

  • All-cash proceeds of approximately $7.2 million;
  • Divested assets averaged approximately 200 boe/d (83% oil) from July-September 2023 or 12% of USEG total production over the same period;
  • All proceeds used to reduce existing debt, leaving USEG materially debt-free;
  • No changes to the company’s existing $20 million borrowing base; and
  • Represents the majority of USEG’s non-operated assets.

With proceeds from the divestitures going towards the company’s debt reduction, “U.S. Energy now sits in a position of increased liquidity across all measures and meaningful portions of [U.S. Energy’s] 2024 oil production, hedged at an average price in the low $80’s,” USEG’s CEO Ryan Smith said. “As we enter 2024, we look forward to focusing our capital allocation efforts on the company’s highest rate of return growth initiatives, maintaining a strong balance sheet and driving shareholder returns.”