To focus on Permian, QEP sells Haynesville assets

By Luke Geiver | November 26, 2018

Aethon Energy is putting its investment expertise to work in the Haynesville shale. The Dallas-based energy investment company that is active in many of North America’s most active shale plays, has spent $735 million to purchase the Haynesville shale assets previously owned and operated by QEP Resources.

As part of the deal, Aethon has agreed to assume all firm gas transportation agreements.

Aethon III, the subsidiary of Aethon that is making the acquisition, will use a investment strategy that the company has been deploying since 1990. The strategy emphasizes “downsize protection and the preservation of capital by opportunistically pursuing transactions where Atheon believes it can alter the risk or reward profile in its favor.”

The goal of Aethon is to acquire assets that provide superior returns through reserve development and replacement, identifying unappreciated upside, improved efficiency and cost reduction, disciplined hedging, and financing and divestiture strategies.

QEP intends to use the proceeds of the sale to bolster its Permian position. "The sale of our Haynesville/Cotton Valley business is an important next step in our process of becoming a Permian pure-play company,” said Chuck Stanley, chairman, president and CEO of QEP. “We intend to use the proceeds from this sale to fund the ongoing development of our core Permian assets, reduce debt, and return cash to shareholders through a share repurchase program."

The assets included in the sale consist of more than 50,000 net acres and just under 5,000 barrels per day across 137 operated wells.