Goodrich Petroleum sells Eagle Ford assets for $118 million

HOUSTON -- Goodrich Petroleum Corp. has entered into a definitive agreement to sell its proved reserves and associated leasehold in the Eagle Ford shale in LaSalle and Frio Counties, Texas, for $118 million.

The effective date of the transaction is July 1, 2015, with an expected closing date on or before Sept. 4, 2015.  The company is retaining approximately 58% (~ 17,000 net acres) of its undeveloped leasehold in the play for future development or sale. The asset being sold produced an average of approximately 2,850 boed (~75% oil) during the first quarter of 2015. 

Goodrich, an independent E&P company, expects to book a gain of approximately $50-60 million on the sale at closing after factoring in customary closing adjustments. The company plans to pay off its bank revolver and retain the difference in cash from the sales proceeds.

Regarding the sale, Robert Turnham, the company's president, said, "The monetization of our proved reserves and associated acreage from our drilling efforts to date greatly improves our liquidity while maintaining a position in the Eagle Ford for future development or sale. Acreage retention was an important aspect of this transaction for us as it allows for additional future value creation from the asset in what we believe will be an improved oil price environment."