More news from Pioneer. It looks like they are shedding some assets in an attempt to return to profitability. At least they are starting to do something...
01:15 PM ET 09/08/98
Pioneer Natural Resources sells 425 domestic oil, gas fields
DALLAS, Sept 8 (Reuters) - North American oil and gas
producer Pioneer Natural Resources Co. said Tuesday it
agreed to sell 425 domestic oil and natural gas fields to
Costilla Energy for $410 million in an move to
streamline its operations and cut debt.
Pioneer, one of the largest independent oil exploration and
production companies in the U.S., said that despite the recent
volatility in oil and gas prices, the sales price "falls
comfortably within Pioneer's range of expectations."
Pioneer, based in Irving, Texas, near Dallas, was set up in
1997 as a result of the $1.9 billion merger of MESA, the
company founded by flamboyant oilman T. Boone Pickens, and oil
driller Parker & Parsley. Costilla Energy, based in Midland,
Texas, is an independent oil and gas producer.
Scott Sheffield, president and chief executive officer,
said in a statement that "reducing our debt by $410 million
significantly improves our financial flexibility."
Pioneer estimates that the fields, mostly located in Texas,
produce about eight million barrels of oil equivalent annually,
of which about 57 percent is natural gas.
The properties represent about 95 percent of the company's
domestic fields but only about 10 percent of year-end 1997
proved reserves, according to Pioneer.
The company is based near Dallas in Irving, Texas.
The transaction will be effective Oct. 1, 1998, and is
expected to close by year end.
Including the resulting decline in interest expense,
Pioneer said it expects its total cost structure will have been
cut by more than $3.00 per barrel of oil equivalent since the
end of 1997.
Early Tuesday afternoon, Pioneer Natural Resources stock
was up 31 cents to $14.94 a share in composite New York Stock
Exchange trading. Costilla Energy's stock, traded on Nasdaq,
was up 50 cents to $8.50 a share.
((New York Newsdesk 212-859-1610)) |
