Swift Energy Co. (NYSE: SFY) and PT Saka Energi Indonesia closed a joint venture to develop Swift’s Eagle Ford acreage in Webb County, Texas, Swift said July 15.
PT Saka Energi Indonesia is a subsidiary of PT Perusahaan Gas Negara (Persero) Tbk, Indonesia’s largest gas transportation and distribution company, Swift noted.
Under the deal, 8,300 acres in the Eagle Ford’s Fasken area will be developed, and Swift sold a 36%, full participation interest to Saka for $175 million in cash. At closing, $125 million was paid, and Saka will pay $50 million in cash over time to carry part of Swift’s field development costs, the company said.
At closing, Swift received about $147 million in total, which included Saka’s capital costs (net of revenue) since the transaction’s effective date of Jan. 1, the company said.
Swift will use the proceeds to reduce the borrowings under its credit facility, and will also use them to fund Eagle Ford property developments, the company said.
J.P. Morgan Securities LLC was Swift’s financial adviser, the company said.
“Both parties have worked diligently towards the conclusion of this transaction, and we look forward to working alongside Saka to optimize this asset's value through an advanced technology development program,” said CEO Terry Swift.
“This arrangement marks the beginning of a strategic partnership to grow production in the Eagle Ford dry-gas window of South Texas,” he added.
Swift Energy Co. is based in Houston and operates in Texas and offshore Louisiana.
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