EV Energy Partners LP (Nasdaq: EVEP) reports that it, along with certain institutional partnerships managed by EnerVest Ltd., has signed an agreement to divest certain acreage in Ohio's Utica shale play for $284.3 million to an undisclosed buyer. The total acreage associated with this sale includes 22,535 acres in Guernsey, Harrison and Noble counties. Of that total, EVEP is selling 4,345 acres for approximately $56 million, net to its ownership interest. EVEP will retain its overriding royalty interests in these acres.
The transaction is expected to close by the end of the third quarter and is subject to customary closing conditions and purchase price adjustments. Jefferies LLC is advising EVEP as it continues to market its Utica acreage.
In addition to the acreage sale, EVEP has announced the opening of the Utica East Ohio (UEO) midstream facilities, which started processing gas in July. The facility is processing more than 85 mmcf/d of wet gas, has a capacity of 200 mmcf/d, and throughput is expected to increase steadily over the next few weeks as additional wells are turned in line. With UEO and other processing facilities now available, more Utica wells are being turned in line, which is increasing the flow of gas through the Cardinal Gas gathering system. Increased volumes and cash flow are anticipated for the rest of this year and into 2014.
Recently, EVEP entered into an amendment to its credit facility to change the senior secured debt to EBITDAX ratio to be no greater than 3.5 to 1 through March 30, 2015, and to include certain updates related to the Dodd-Frank Act eligibility requirements for guarantors of hedging transactions.
EV Energy Partners LP is a master limited partnership engaged in acquiring, producing and developing oil and gas properties.