California Resources Sells Ventura Basin Operations for $102 Million

California Resources Corp. on Aug. 5 disclosed the sale of its Ventura Basin operations, which could result in total cash proceeds of up to $102 million.

The independent oil and natural gas company, whose operations focus in the Golden State, revealed the sale as well as a $53 million acquisition in a release announcing the company’s second-quarter results.

“These strategic A&D transactions will simplify our business model, lower our overall operating costs and provide positive net cash proceeds,” commented Mac McFarland, president and CEO of California Resources, in the release.

According to the release, California Resources signed agreements during the second quarter to divest operations in the Ventura Basin for total cash consideration of up to $102 million plus additional earn-out consideration linked to future commodity prices. The buyer of California Resources Ventura Basin operations, which produced 3,600 boe/d (about 65% oil) during the first quarter, was not disclosed.

The company expects the transactions, set to close later this year, will simplify its business model, lower its overall operating costs and decrease its asset retirement obligations, the release said.

Meanwhile, the acquisition announced Aug. 5, made post the second quarter in August, included working interest in the joint venture wells held by Macquarie Infrastructure and Real Assets Inc. (MIRA).

California Resources agreed to pay MIRA $53 million for the 90% working interest it held in the JV wells located in the company’s core areas of the San Joaquin Basin. The acquisition of MIRA’s working interest would have added oil production of 1,600 boe/d (roughly 100% oil) for the first half of 2021 with minimal integration costs and underground risk, according to the company release.