SandRidge Energy is selling all of its holdings in the Gulf of Mexico.
The Oklahoma City-based oil and natural gas company announced early Tuesday morning Fieldwood Energy will pay $750 million in cash and assume $370 million in abandonment liabilities for its Gulf and coastal properties.
“One of the things this does is turns us into a higher-growth business,” SandRidge President and CEO James Bennett said Tuesday during an investor conference call. “So in our minds, we’re selling an asset that had declining production and declining cash flow and taking that capital and redeploying it in areas where we have some clear competitive advantages.”
Bennett said the company had projected a 10-15 percent decline in their offshore assets between 2013 and 2014.
“It was masking some of the growth in our on-shore business,” Bennett said.
In a news release, the company says it plans to use funds previously dedicated to Gulf projects to develop assets in its Mid-Continent properties, which should boost its production by nearly 7 million barrels of oil equivalent over the previous year.
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