Energen Corporation has signed a Purchase and Sale Agreement with an undisclosed buyer to sell its Black Warrior Basin coalbed methane assets in Alabama for $160 million plus standard closing adjustments. The sale is expected to close in early October 2013 and have an effective date of July 1, 2013. Energen plans to use proceeds to reduce short-term indebtedness.

At December 31, 2012, proved reserves associated with Energen's Black Warrior Basin properties totaled 97 billion cubic feet. In addition to the coalbed methane properties, the buyer (a limited liability corporation, or LLC) will assume Energen's third-party operating agreements.

After adjusting fourth quarter production by approximately 0.4 million barrels of oil equivalents (MMBOE) for the sale of these assets, Energen's revised production guidance range from all operations for 2013 is 25.7-26.1 MMBOE. The company's preliminary estimates of 2013 production and income from discontinued operations (excluding a gain on the sale) are, respectively, 1.4 MMBOE and $11.0 million, or 15 cents per diluted share.

Tags: Energen Corporation