Ovintiv Inc. recently closed its previously announced Eagle Ford asset sale, officially marking the company’s exit from the South Texas shale play.
The roughly $880 million in proceeds, combined with those recently received from the Duvernay asset sale, will be applied toward its goal to cut debt by around 35% to $4.5 billion. The company also announced on May 19 it had issued notice to fully redeem outstanding 2021 and 2022, which represents approximately $1.1 billion of debt retirement for Ovintiv.
“Today’s Eagle Ford asset sale continues our track record of delivery and allows us to meaningfully accelerate debt reduction,” Ovintiv CEO Doug Suttles said in a statement in a May 19 company release.
In addition to “strong free cash flow generation,” Suttles now expects Ovintiv to reach the $4.5 billion debt reduction goal by year-end instead of the previously targeted first half of 2022, he said.
“Our priorities today are clear—reduce debt, maintain scale, drive efficiencies, and return cash to shareholders,” Suttles added.
The buyer of the Ovintiv Eagle Ford assets, Validus Energy, is a privately owned E&P company led by Felix Energy founder Skye Callantine, who previously built and sold roughly $7 billion of assets over an 8-year period under the Felix Energy platform.
Validus Energy is financially backed by equity commitments from Pontem Energy Capital, other institutions, and private investors, according to its website.
BMO Capital Markets and Citigroup Global Markets Inc. was Ovintiv’s financial advisers for the Eagle Ford transaction and Davis Graham & Stubbs LLP provided legal counsel.
Recommended Reading
TotalEnergies, RWE Partner on German North Sea Wind Projects
2024-10-07 - TotalEnergies and RWE aim to commission two wind projects, N-9.1 and N-9.2, in 2031 and 2032.
Equinor Acquires Nearly 10% Stake in Ørsted for $2.5B
2024-10-07 - Equinor becomes the second largest stakeholder in Ørsted with its $2.5 billion acquisition of the Danish company’s shares.
TotalEnergies Adds More Eagle Ford Shale Natgas to Support LNG
2024-09-27 - TotalEnergies said its second Eagle Ford deal this year with Lewis Energy Group strengthens the company’s upstream gas position and secures supply for its exports through Cameron LNG.
Apollo to Buy $1B Stake in BP’s Trans Adriatic Pipeline
2024-09-16 - Apollo will purchase the non-controlling interest from BP subsidiary BP Pipelines TAP Ltd. for $1 billion as the oil major continues to make progress on a divestment target of up to $3 billion.
Beyond Energy: EnergyNet Expands Marketplace For Land, Real Assets
2024-09-03 - A pioneer in facilitating online oil and gas A&D transactions, EnergyNet is expanding its reach into surface land, renewables and other asset classes.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.