Carrizo Sells Trumbull, Mercer Leases for $43M
HOUSTON – Carrizo Oil & Gas Inc. has sold the majority interest its mineral leases in Trumbull County, Ohio, and Mercer and Crawford counties in Pennsylvania to an unidentified third party for net cash proceeds of $43 million. Assets included in the sale are an existing drilling pad and approved well drilling permits associated with the leases.
The energy company announced the transaction this morning.
Carriso was awarded its first Utica shale permit May 9, authorizing the company to drill a horizontal well at the Brugler Farm along Hayes-Orangeville Road in Hartford Township, Ohio. Also in May, and in Mercer County, Pa., Carrizo was awarded three permits for horizontal wells in West Salem Township at the Yoder, Phillips and Miklos farms.
Carrizo will continue to own a 10% undivided interest, along with a similar option to increase its ownership to 50%, in nearly 26,000 additional gross acres primarily in Guernsey County, Ohio, “in proximity to recent encouraging industry drilling results,” the company said.
Immediately preceding the property sale, Carrizo exercised a mineral lease purchase option to increase its ownership from a 10% to a 50% undivided interest in the same properties from a subsidiary of its financial partner, Avista Capital Holdings LP.
Carrizo also announced today that its banking syndicate has agreed to increase the company's borrowing base under its senior credit facility from $325 million to $365 million as part of a regularly scheduled borrowing base review. The new borrowing base takes into consideration the effect of the recent sale of Gulf Coast properties and the Niobrara joint venture agreement, the company said.
Carrizo says its operations are “principally focused in proven, producing oil and gas plays. These include the Eagle Ford Shale in South Texas, the Niobrara Formation in Colorado, the Barnett Shale in North Texas, the Marcellus Shale in Pennsylvania, New York and West Virginia, and the United Kingdom’s North Sea.
Copyright 2012 The Business Journal, Youngstown, Ohio.
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