(By Balachander) Carrizo Oil & Gas Inc. (NASDAQ: CRZO) said it has agreed to sell all of its interest in the Huntington Field in the UK North Sea to a subsidiary of Iona Energy Inc. (TSXV: INA) for $184 million.
Houston, Texas-based Carrizo expects to net roughly $116 million, after payment of around $70 million to retire and close its UK credit facility, working capital adjustments and transaction related costs.
"It has been a long and bumpy road for all participants in this project since Carrizo geologists defined the Huntington exploration prospect and our partners drilled the discovery wells," Carrizo CEO S. P. Johnson said. "Now that the project is close to first production and its value much more tangible, our reinvestment opportunities for the net proceeds from this sale are so compelling that we have made the decision to harvest our investment."
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Carrizo expects to apply the net proceeds to fund a portion of its 2013 capital investment needs and for other general corporate purposes.
The company expects the deal to close on or before the end of January.
Carrizo's current operations are principally focused in proven, producing oil and gas plays primarily in the Eagle Ford Shale in South Texas, the Niobrara Formation in Colorado, the Barnett Shale in North Texas, and the Marcellus Shale in Pennsylvania, New York and West Virginia
The stock, which has been trading in the 52-week range of $19.03 to $31.62, closed at $21.81 on Thursday.