PetroQuest Energy Inc. (NYSE: PQ) has closed the sale of the majority of its remaining Woodford Shale assets in the East Hoss field for gross proceeds of $18 million, subject to purchase price adjustments between the effective date of April 1, 2016, and the closing date.
The sold assets produced approximately 10 MMcfe/d during the first quarter of 2016. As of December 31, 2015, the company's estimated proved reserves attributable to the sold assets totaled approximately 19 bcfe - 81% proved developed with PV-10 of $16 million.
At March 31, 2016, PetroQuest Energy had approximately $71 million in cash, pro forma for the gross proceeds received in the sold assets divestiture. The company continues to have no borrowings outstanding under its bank credit facility.
Closing of the deal is a positive, noted Seaport Global Securities analysts Thursday morning. The company “further enhances already-ample liquidity and is positioned to survive a bleak natural gas tape in FY16 with a capital efficient FY16 program. Attention now turns to a potential JV on PQ's Cotton Valley acreage, which could provide a source of capital to help carry a development program in the Cotton Valley, where PQ has seen recent operational momentum (peak IPs on latest two wells ~12% greater than prior seven, well costs of $4MM down 11% from 2015 year-end).”