The transaction has an effective date of January 1, 2014.
The properties are primarily located in Karnes County and consist of interests in approximately 117 non-operated producing wells. Alta Mesa Eagle LLC has retained a 50% net profits interest, "NPI," in the proved developed producing, or "PDP" wells as of January 1, 2014. At year-end 2014, 2015 and 2016, the NPI automatically reduces to 30%, 15% and 0%, respectively.
Separately, Alta Mesa Eagle LLC has also retained an interest in 70% of all non-PDP wells and undeveloped leasehold acreage held as of January 1, 2014. Alta Mesa’s borrowing base will adjust to $285 million from $385 million as a result of the sale.
"This sale provides for an acceleration of cash flow from these assets which we will use, in part, to accelerate development in our other core operated properties in the Sooner Trend and Weeks Island," said Hal Chappelle, Alta Mesa’s President and CEO, "We believe we are receiving full value for these properties, while at the same time preserving future upside potential."
