Seeking Alpha

SandRidge to sell Gulf of Mexico business for $750M, raises output guidance

  • SandRidge Energy (SD) +7.4% premarket after announcing the sale of its Gulf of Mexico business to Fieldwood Energy for $750M cash and the assumption of $370M of abandonment liabilities; SD will retain a 2% overriding royalty interest in certain exploration prospects.
  • Adjusting for the impact of the sale, SD provides revised guidance for 2014, including production growth of 26% vs. 12% previous guidance; in 2014, SD will redeploy the capital expenditures previously allocated to Gulf of Mexico development into its Mid-Continent assets.
  • SD plans to add three additional rigs during Q2, resulting in the drilling of ~30 additional gross wells vs. the previous budget; it now expects to exit 2014 with 29 rigs operating in its Mid-Continent acreage.
Comments (7)
  • rjj1960
    , contributor
    Comments (1359) | Send Message
     
    Tom Ward purchased that business for 1.5 Billion.
    7 Jan, 08:06 AM Reply Like
  • SuperLube
    , contributor
    Comments (2) | Send Message
     
    1.28 billion but who is counting anyways. Typical SandRidge.... Turn $1 invested into $.50.
    7 Jan, 08:38 AM Reply Like
  • Bob Curtin
    , contributor
    Comments (67) | Send Message
     
    IMO, it is a real positive that the new management is not afraid to unwind Ward's follies and bring a laser focus to building a solid E&P company.
    7 Jan, 08:54 AM Reply Like
  • Bob de'Long
    , contributor
    Comments (696) | Send Message
     
    Thanks for the numbers guys. Isn't half a billion about what Tom pocketed for his term as CEO?
    7 Jan, 09:31 AM Reply Like
  • tealone
    , contributor
    Comments (213) | Send Message
     
    IMO, Mr. Ward could spend a few years entertaining this guy I know that goes by the name of "Mad Bernie"! As for SD, I might give it another look over (but you know the saying; "fooled once and shame........").
    7 Jan, 11:42 AM Reply Like
  • DeepValueLover
    , contributor
    Comments (8150) | Send Message
     
    What a disaster!
    7 Jan, 12:41 PM Reply Like
  • joeluce
    , contributor
    Comments (2) | Send Message
     
    I don't see this as a disaster, but as a way to focus their drilling and production in one area. The deal was better than break even if you add 750 to 370 plus production revenue and the 2%. The problem here is SD under Tom Ward shouldn't have bought this in the first place. It spread SD to thin. Great move to focus on one area.
    9 Jan, 07:57 AM Reply Like
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