Acquisition and Divestitures of Oil and Gas Properties

12 Months Ended

Dec. 31, 2016

Acquisition and Divestitures of Oil and Gas Properties

Acquisition and Divestitures of Oil and Gas Properties

8. Acquisition and Divestitures of Oil and Gas Properties

Dequincy Divestiture

        On April 21, 2015, the Company closed the Dequincy Divestiture for $44.0 million, completing the Company's disposition of its producing properties and proved reserves in Louisiana. The net proceeds, inclusive of amounts placed in escrow, were approximately $42.4 million, which was net of customary closing adjustments. This amount was reflected as a reduction of oil and natural gas properties, with no gain or loss recognized. The net proceeds were retained for general corporate purposes.

Pine Prairie Disposition

        On May 1, 2014, the Company closed on the sale of all of its ownership interest in developed and undeveloped acreage in the Pine Prairie field area of Evangeline Parish, Louisiana to a private buyer for a purchase price of $170.0 million in cash ($147.7 million net of standard post-closing adjustments). Acreage subject to the transaction did not include acreage and production in the western part of Louisiana in Beauregard and Calcasieu Parishes or other undeveloped acreage held outside the Pine Prairie field. Proceeds of $131.0 million were used to reduce amounts outstanding under the RBL, with the remainder retained for transaction expenses and working capital purposes. This amount was reflected as a reduction of oil and natural gas properties, with no gain or loss was recognized.

Exploration Agreement with PetroQuest

        On June 25, 2014, the Company entered into an exploration agreement with PetroQuest Energy LLC ("PetroQuest") with an effective date of May 1, 2014, in which the Company conveyed to PetroQuest an undivided 50% of its right, title and interest in and to the acreage and other interests in the Fleetwood prospect area in Louisiana. With the execution of the agreement, PetroQuest paid $3.0 million in cash consideration and in January 2015, PetroQuest paid additional cash of $7.0 million. As further consideration, PetroQuest granted a credit to the Company of an additional non-interest bearing total sum of $14.0 million, to be credited or paid against the Company's share of costs or expenses incurred to develop the prospect area, including but not limited to, all mineral lease acquisition or maintenance costs and all drilling, completion, equipping and facility costs. For any amounts not fully credited on or before December 31, 2015, the Company could elect to take the remaining portion in cash. The Company received the unutilized portion of the non-interest bearing amount of approximately $4.4 million during 2016.

Acquisition and Transaction Expenses

        For the year ended December 31, 2015, acquisition and transaction costs of $0.3 million relate to the execution of the Dequincy Divestiture.

        For the year ended December 31, 2014, acquisition and transaction costs of $4.1 million were incurred primarily as a result of the Pine Prairie Disposition and include advisory, legal, accounting, valuation and other professional and consulting fees related to the sale.