(By Balachander) Noble Energy Inc. (NYSE:NBL) has agreed to sell certain oil and natural gas assets to contract drilling company Unit Corp. (NYSE:UNT) for $617 million.
The deal will strengthen Unit's presence in the Anadarko Basin of Western Oklahoma and the Texas Panhandle basins as well as immediately adding to cash flow and to earnings starting next year.
The assets to be sold to Unit's Petroleum division include roughly 84,000 net acres primarily in the Granite Wash, Cleveland, and Marmaton plays in western Oklahoma and the Texas Panhandle.
The transaction will more than double Unit's acreage in the Granite Wash Texas Panhandle core area for its upstream business segment. The acquisition will add about 25,000 net acres to Unit's Granite Wash core area with significant resource potential and would include 617 potential horizontal drilling locations.
David Stover, Noble Energy's operating chief said the sale is will allow the company to allocate capital to high-value and high-growth areas as well as accelerate the horizontal oil play in the DJ Basin.
Unit plans to fund the deal, which is expected to be completed in September 2012, with long-term debt.
NBL shares ended at $83.06 on Tuesday, while Unit stock closed at $36.10.