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Range Resources Closes Sale of its Bradford County Assets

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Range Resources Corporation (RRC - Free Report) has closed its Bradford County non-operated asset sale.

The sale, which had an effective date of Jan 1, 2016, generated proceeds of about $110 million after purchase price adjustments at the closing as well as retained the net cash flow since the effective date.

Range Resources had inked purchase and sale agreement in early February. The agreement included the company’s non-operating Marcellus interest in Bradford County, PA for about $112 million.

Range Resources divested an average working interest of 23% spanning about 10,900 net acres with net production capacity of about 22 million cubic feet per day (Mmcf).

Notably, Range Resources’ first-quarter 2016 reported operations will include the Bradford County operations until the closing date of the sale. The funds raised through the sale will be used to lower debt and for other corporate purposes. The transaction will also strengthen the company’s financial position by reducing leverage and boosting liquidity. However, the borrowing base under Range Resources' revolving credit facility remains unchanged at $3 billion, post sale.

Range Resources’ diversified asset portfolio is spread between low-risk/long reserve-life Appalachian assets and large-volume/rapid-payout Gulf Coast properties. The company has an impressive inventory in the Marcellus Shale, one of the prominent emerging shale plays in the U.S. Lower 48. The company is advantageously positioned to benefit in the long run from these projects. Given its dominant position in the Marcellus Shale play and its continuous endeavor to control costs, we believe that Range Resources will be capable of long-term shareholder value creation.

Currently, Range Resources carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy sector are SolarEdge Technologies, Inc. (SEDG - Free Report) , Statoil ASA and Enviva Partners, LP (EVA - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy).

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