Occidental Petroleum (Oxy) said this week it has agreed to sell almost 25,000 net acres in the Permian Basin of Texas to Colgate Energy Partners III for nearly $508 million. Average output of the properties amounts to 10,000 BOE/D from about 360 wells in the southern Delaware Basin, Houston-based Oxy reported in its announcement.
The sale, expected to close in the third quarter, will boost Midland-based Colgate’s holdings in the Permian to about 83,000 acres with an estimated production of 55,000. Colgate said it plans to run up to six drilling rigs by year’s end and boost average production to 75,000 BOE/D by 2022.
Proceeds from the sale will be used to pay down Oxy’s debt that was around $35.4 billion in March, down slightly from the $36.03-billion debt reported last June.
Oxy said its divestment program that began in 2019, following its $38-billion acquisition of Anadarko Petroleum, now represents a sum more than $9 billion.
In October, Oxy announced the sale of onshore assets in Colombia to the private equity firm Carlyle Group for $825 million. Oxy has operated in Colombia for more than 40 years and said at the time of the sale that it will remain focused on the South American country’s offshore exploration blocks.
