PDC Energy Inc. (NASDAQ: PDCE) announced Oct. 15 it closed the sale of its 50% interest in PDC Mountaineer LLC (PDCM), a Marcellus joint venture (JV), to Mountaineer Keystone Energy LLC for $250 million.

PDC's net pre-tax proceeds were roughly $190 million after repayment of its share of JV debt and other working capital and other adjustments and fees, and subject to customary post-closing adjustments. Net proceeds were comprised of about $150 million cash and a $40 million note from the buyer.

The buyer also assumed PDC's share of the related firm transportation obligations as well as PDC's share of certain PDCM natural gas hedging positions.

The assets produced about 26 million cubic feet equivalent of natural gas per day net to PDC in the second quarter of 2014 (99% gas). Estimated proved reserves net to PDC were 240 billion cubic feet as of Dec. 31, 2013.

Tudor Pickering Holt was adviser on the sale.

In addition, Denver-based PDC announced its borrowing base increased to $700 million from $450 million following the recently completed semi-annual redetermination of its revolving credit facility. The company elected to maintain its commitment level at $450 million at this time since it expects to be minimally drawn on its revolver at year-end 2014 in part due to the proceeds from the sale its interest in the PDCM JV.

Barton Brookman, president and COO, said in a statement, "The net proceeds from the PDCM sale and the increase in our borrowing base are expected to both further strengthen our balance sheet and provide PDC with excellent liquidity. This liquidity gives us tremendous flexibility to execute our capital programs while our strong oil and natural gas hedging positions protect the company's cash flow."