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Oil and natural gas exploration company, Noble Energy Inc. (NBL - Analyst Report) inked a deal for the sale of certain oil and natural gas assets in the Permian Basin to a Texas-based, privately owned oil and natural gas company, Sheridan Holding Company II, LLC, for $320 million.
The properties up for sale are located in a major energy producing region in the basin and include 250 oil and liquid hydrocarbons wells. The production capacity of these wells is roughly 1,500 barrels of oil equivalent per day. The settlement is anticipated to be finalized in August 2012.
Noble Energy for the past several quarters has been increasingly involved in the divestiture of peripheral assets in western Oklahoma and Texas panhandle regions as well as in the North Sea, UK. The sale of the Permian resources is also a part Noble’s continued long-term divestiture strategy.
The divestiture of these non-core assets will enable the company to concentrate on the development of its primary operations in the US and overseas. In addition, the gain from this sale would boost Noble’s financials and add flexibility to its operations leading to a ramp in its top- and bottom-line estimates.
Noble Energy’s active competitor Anadarko Petroleum Corporation (APC - Analyst Report) is in talks to sell some or its entire stake (36.5%) in the offshore gas fields of Mozambique to Royal Dutch Shell Plc. (RDS.A - Analyst Report). The company on initiation of the auction process could receive $8 billion from this sale.
Noble Energy estimates sales volumes to average 242–250 thousand barrels of oil equivalent per day (MBoe/d) in the third quarter excluding volume from discontinued operation, while its 2012 volume guidance is in the range of 236–244 MBoe/d. Noble expects exploration expenses for 2012 to be in the range of $450 million to $500 million.
The Zacks Consensus Estimates for the third quarter and full year 2012 are currently at $1.21 per share and $5.38 per share, respectively. Noble Energy holds a Zacks #3 Rank, which translates into a short-term Hold rating.
Based in Houston, Texas, Noble Energy is an independent exploration and production (E&P) company, having high-grade hydrocarbon assets across the U.S. and several international locations. Noble Energy chiefly focuses on organic growth from exploration and development drilling activities. This is further strengthened by mergers and acquisitions.
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