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Southwestern Energy sign agreement to sell Fayetteville shale business for USD 1.865 billion

Gasoil News - Published on Fri, 07 Sep 2018

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Southwestern Energy Company announced that it has entered into a definitive agreement with Flywheel Energy, LLC, a private company backed by Kayne Private Energy Income Funds, to sell its Fayetteville Shale E&P and related midstream gathering assets for USD 1.865 billion in cash, subject to adjustments and customary closing conditions. In addition, the buyer will assume approximately $438 million of future contractual liabilities after taking into account certain obligations retained by the Company. The transaction, which was unanimously approved by Southwestern Energy’s directors, has an effective date of July 1, 2018, and is expected to close in December 2018.

Maersk Reacher will be deployed as an accommodation rig, with the option of repurposing the rig for plugging & abandonment for the final phase of the contract. The rig is expected to commence operations in its new role by October 2018. The flexible contract is agreed upon in continuation of the alliance between Maersk Drilling and Aker BP, where the parties have committed to align incentives and co-create optimal solutions.

Mr Morten Kelstrup, CCIO of Maersk Drilling, said that “Like Aker BP, we see great value in working closely together, and the benefit is obvious in this contract where adaptability to the customer’s needs is key for Aker BP to be able to make a long-term commitment. Maersk Drilling is fully committed to providing smarter drilling for better value to our customers, and the Maersk Reacher contract demonstrates that the alliance framework we have entered with Aker BP enables us to identify mutually beneficial solutions.”

Maersk Reacher provides Aker BP with an accommodation capacity of 85 personnel onboard. It is being reactivated from warm-stacking in Invergordon, Scotland, and will now return to Norwegian waters where the rig will be deployed at Valhall East field, with a fixed contract length of two years. Rather than simply committing to two full years of accommodation costs, Aker BP has the option to repurpose the Reacher for plugging & abandonment for the final six months of the contract.

Maersk Drilling and Aker BP entered the joint jackup alliance in November 2017. The alliance aims at increasing profitability for the partners and is formalised in a five-year agreement with the option to extend for an additional five years. Maersk Reacher in the Norwegian part of the North Sea.

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Posted By : Nanda Koijam on Fri, 07 Sep 2018
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