Linn Energy has signed a definitive agreement to sell its interest in properties located in western Wyoming to Jonah Energy for a contract price of $581.5 million.
“This sale allows us to significantly reduce leverage and improve financial flexibility,” said Mark E. Ellis, president and CEO of Linn Energy.
The properties consist of approximately 27,500 total net acres, including 16,000 net acres in the Jonah and Pinedale Anticline fields with first quarter net production of approximately 129 MMcfgd, proved reserves of 384 Bcfe and proved developed PV10 of approximately $369 million.
“This sale also marks the first step of transitioning Linn from a conventional production-based MLP to a streamlined growth-oriented enterprise,” said chairman Evan Lederman.
The board will continue to work hand-in-hand with management to execute on a value maximizing and transformative business plan. The plan includes continuing the previously announced sale of noncore assets, accelerating investment in key horizontal growth plays and focusing on the firm’s overall cost structure to become a best-in-class low-cost operator.
The sale to Jonah is expected to close in the second quarter of 2017.