XTO sells San Juan Basin assets to Hilcorp
Hilcorp finalized another big acquisition from ConocoPhilips in July
- The change of hands includes some 1,770 XTO-operated natural gas wells.
- Hilcorp may retain some of XTO's 230 local employees.
- San Juan County CEO Kim Carpenter is hopeful Hilcorp's acquisitions will result in an uptick of oil and gas activity.
XTO spokesman Jeremy Eikenberry confirmed the sale today. Hilcorp did not respond to a request for comment.
Hilcorp is acquiring approximately 1,770 XTO-operated wells and interest in approximately 690 wells operated by other companies, Eikenberry said.
The upstream assets have an average production of 125 million cubic feet of natural gas equivalent per day, Eikenberry said.
The sale was finalized on Monday and will close in the first quarter of 2018, Eikenberry said. The terms of the sale are confidential.
Hilcorp acquired 1.3 million net acres from ConocoPhilips in a sale that closed on July 31. That change of hands included 14,000 wells in the San Juan Basin, Brian Wilbanks, Hilcorp’s senior vice president of exploration and production for the Lower 48 – West Region, told The Daily Times in November.
XTO employs about 230 people in its Aztec office, and Eikenberry said Hilcorp is expected to interview and hire some of XTO’s employees during the transition. XTO employees also may have opportunities to continue working within XTO’s operations throughout the country, with major operations in the Permian and Marcellus basins.
“We expect that employees can be offered job opportunities by Hilcorp, or they may be offered other opportunities within XTO. However, we can’t guarantee employment with XTO or any other company,” Eikenberry said.
San Juan County CEO Kim Carpenter discussed the sale during Tuesday’s County Commission meeting and said on today that “it’s too early for us to get an idea of what that transition is going to look like” for San Juan County residents and local economy.
“Obviously, we don’t want to lose any more jobs in the basin, but at the same time we look and say, ‘Well, is Hilcorp going to be a company that’s going to come in and actually get people to work?’” Carpenter said. “XTO has always been a good partner to this community, and we will sorely miss their presence, but one can only be hopeful that we see some kind of additional growth.
"Companies don’t just buy assets to sit on them, and Hilcorp has different ideas about how to approach things with low commodity prices," Carpenter continued. "I’m hopeful that we would see an uptick in activity."
Megan Petersen covers business and education for The Daily Times. Reach her at 505-564-4621 or email@example.com.