Clayton Williams Energy, Inc. has entered into a transaction with a financial investor to monetize 95% of its Wolfberry oil and gas reserves, leasehold interests and facilities located in Andrews County, Texas (the "Assets") for $214 million, subject to customary closing adjustments.

The Company will use the proceeds from the transaction to reduce the amount outstanding on its revolving bank credit facility. At closing of the transaction, the borrowing base under the facility will be reduced from $585 million to $470 million to account for the release of collateral, providing the Company with approximately $99 million of additional availability under the facility. Closing is expected to occur on April 24, 2013.

In connection with the transaction, the Company will contribute 5% of the Assets to a newly formed limited partnership in exchange for a 5% general partner interest, and the partnership will purchase the remaining 95% of the Assets from the Company. The partnership will obtain the proceeds from the investor in exchange for a 95% limited partner interest.

Tags: Clayton Williams Energy Inc.