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Eagle Ford: Key Insights, Industry Outlook, and More

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Part 11
Eagle Ford: Key Insights, Industry Outlook, and More PART 11 OF 13

Key Acquisition in the Eagle Ford Shale This Year

Sanchez Energy

On January 12, 2017, Anadarko Petroleum (APC) announced that it would be selling its Eagle Ford assets to Sanchez Energy (SN) and The Blackstone Group for a total of ~$2.3 billion. The assets include ~155,000 acres, primarily in Dimmit and Webb counties. Anadarko estimated that its 4Q16 production volumes from these assets were ~45,000 barrels of liquids per day and ~131 million cubic feet of natural gas per day. The transaction is expected to close in 1Q17.

In a press release, Sanchez Energy CEO Tony Sanchez stated that “the closing of this transaction increases our total net proved reserves to approximately 340 MMBoe,1 which represents an increase of approximately 78 percent from our year-end 2016 reserves. With the current development plan, we expect full year 2018 net production to be in excess of 100,000 Boe per day, double our average production rate for 2016.  Importantly, we view this transaction as a key step toward deleveraging the Company’s balance sheet.”

Key Acquisition in the Eagle Ford Shale This Year

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This sale was in line with Anadarko’s strategy to remain focused on its DJ (Denver-Julesburg), Delaware Basin, and Gulf of Mexico operations in 2017. However, its MLP, Western Gas Partners (WES), will still own and operate the midstream assets in the Eagle Ford Shale. Anadarko closed asset monetizations of over $5 billion in 2016, well above its target of $4 billion.

  1. million barrels of oil equivalent
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