QEP Resources Inc.’s (NYSE: QEP) slow exit from the Sooner State might be coming to a close.

After selling a bulk of its Oklahoma assets in 2014, QEP is in the process of clearing away the remaining odds and ends of its residency in the state, including the sale of assets in two upcoming auctions with EnergyNet.

The company has instead turned its focus largely to the Permian and Williston basins.

The assets consist of non-producing minerals, non-participating royalty interest and HBP leasehold acreage in several counties located in the central, northern and eastern parts of the state. QEP is selling roughly 3,830 mineral interest acres in two packages.

QEP largely exited the Midcontinent in June 2014 with the $497 million sale of its Cana Woodford Shale assets to Cimarex Energy Co. (NYSE: XEC). In December 2014, QEP also sold interests in noncore properties in southern Oklahoma for an aggregate $101.3 million, according to SEC filings.

Brent Rockwood, communications director at QEP, said that while the assets performed well, they fell short of company’s criteria that be:

  • Contiguous;
  • QEP operated; and
  • Have a high working interest.

“We probably have some remaining acreage that our team is looking to sell,” Rockwood said.
Since 2014 the company has continued marketing its remaining Midcontinent assets, primarily in the Scoop and other Arkoma and Anadarko Basin assets, with current aggregate net production of about 21 million cubic feet equivalent per day (MMcfe/d).

QEP, Midcontinent, Scoop, spending, EnergyNet

Meanwhile, QEP's capital allocation to the Midcontinent/Scoop has plunged and the company has not filed a drilling permit in Oklahoma since at least Dec. 2, 2014, according to the Oklahoma Department of Environmental Quality.

QEP Midcontinent/Scoop Spending

The company’s departure from Oklahoma also required a restructuring of QEP’s workforce. In July, QEP announced the closing of its regional office in Tulsa, Okla., which represented about 10% of its workforce.

The company decided to have all assets and technical teams under one roof in Denver, Rockwood said.

“There was also a cost savings component,” he said. “In this environment, companies such as QEP are being aggressively cost efficient.”

Bidding for both packages opens on Dec. 3, and closes on Dec. 10. For due diligence information visit energynet.com or contact Ryan P. Dobbs, business development manager for EnergyNet, at 720-459-2072.

Darren Barbee can be reached at dbarbee@hartenergy.com, and Emily Moser can be reached at emoser@hartnergy.com.

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