CALGARY, Dec. 19, 2012 /CNW/ - PENN WEST PETROLEUM LTD. (TSX - PWT) (NYSE - PWE) ("PENN WEST") is pleased to announce that it has closed its previously announced
divestment of non-core assets.
In June of 2012, Penn West announced its intention to divest of $1.0 to
$1.5 billion of non-core assets. Effective today, the last of a number
of asset dispositions related to this plan closed for total gross
proceeds of approximately $1.3 billion. In addition to these
dispositions, we also recently closed a series of minor dispositions.
Total proceeds from all sales of approximately $1.35 billion were used
to repay outstanding indebtedness on the company's credit facility.
Total production and reserves associated with the combined divestments
was approximately 13,000 boe per day and 69 million boe of proved plus
probable reserves, respectively. On average, both production and
reserves were weighted approximately 95% toward oil and liquids.
Divested assets were located primarily in Southeast Saskatchewan and
represented mature, base assets in Penn West's asset portfolio. CIBC
World Markets acted as an advisor to Penn West on the divestment of the
royalty interest in the Weyburn unit in southeast Saskatchewan.
Average transaction metrics were approximately $103,000 per flowing
barrel and approximately $19 per boe of proved plus probable of
reserves. Penn West expects to record a gain on the sale of the assets
in the range of $250 to $300 million.
Our full year 2012 average production guidance released with our third
quarter results is between 161,000 to 163,000 boe per day, prior to
these divestments. Penn West expects its 2012 annual average production
to remain in this same guidance range after the effect of these
Penn West plans to release its 2013 capital budget in mid-January, 2013.
Penn West is one of the largest conventional oil and natural gas
producers in Canada. Penn West operates a significant portfolio of
opportunities with a dominant position in light oil in Canada. Based in
Calgary, Alberta, Penn West operates throughout western Canada on a
land base encompassing approximately six million acres.
Penn West shares are listed on the Toronto Stock Exchange under the
symbol PWT and on the New York Stock Exchange under the symbol PWE.
This news release contains certain forward-looking statements and other
information (collectively "forward-looking information") about our
current expectations, estimates and projections, made in light of our
experience and perception of historical trends. Forward-looking
information in this news release is identified by words such as
"potential", "expect", "guidance", "plan" or similar expressions and
includes suggestions of future outcomes, including statements about:
the estimation that total production and reserves associated with the
divestments was approximately 13,000 boe per day and 69 billion boe of
proved plus probable reserves, respectively; the expectation that Penn
West will record a gain on the sale of the assets in the range of $250
to $300 million; and the expectation that 2012 annual average
production will remain in the same guidance range after the effect of
these divestments. Readers are cautioned not to place undue reliance on
forward-looking information as our actual results may differ materially
from those expressed or implied.
Developing forward-looking information involves reliance on a number of
assumptions and consideration of certain risks and uncertainties, some
of which are specific to Penn West and others that apply to the
industry generally. For information on the factors or assumptions on
which the forward-looking information is based and the risk factors and
uncertainties that could cause our actual results to differ materially,
see "Forward-Looking Statements" in our 2012 Third Quarter Management's
Discussion & Analysis. For a full discussion of our material risk
factors, see "Risk Factors" in our most recent AIF/Form 40-F, and risk
factors described in other documents we file from time to time with
securities regulatory authorities, all of which are available on SEDAR
at www.sedar.com, EDGAR at www.sec.gov and our website at www.pennwest.com.
SOURCE: Penn West Exploration
For further information:
PENN WEST EXPLORATION
Penn West Plaza
Suite 200, 207 - 9th Avenue SW
Calgary, Alberta T2P 1K3
Toll Free: 1-866-693-2707
Toll Free: 1-888-770-2633
Murray Nunns, President & Chief Executive Officer
Clayton Paradis, Manager, Investor Relations