Sale of 257 non-operated legacy working
interest wellbores for $10.7
million, advances strategy of high-grading Company's
asset base to further fixed-cost royalty production model
FORT
WORTH, Texas, Dec. 27,
2022 /PRNewswire/ -- PHX MINERALS INC. (NYSE: PHX),
announced today that it has entered into two agreements with
separate buyers to sell 257 non-operated legacy working interest
wellbores in the Arkoma Basin and the Eagleford Play for total cash
consideration of approximately $10.7
million. Each Agreement is subject to customary closing
conditions and adjustments. The buyers of the assets will also
assume approximately $879,000 of
aggregate asset retirement obligations from the Company. Both
transactions are expected to close by the end of January 2023.
The Arkoma Basin sale consists of 151 non-operated legacy
working interest wellbores with a purchase price of approximately
$5.1 million and $235,000 of assumed asset retirement obligations.
The Eagleford Play sale consists of 106 non-operated legacy working
interest wellbores with a purchase price of approximately
$5.6 million and $644,000 of assumed asset retirement
obligations.
PHX intends to use the proceeds from these divestitures to
acquire additional minerals with existing production and
line-of-sight development and to repay borrowings under the
Company's credit facility.
On a pro forma basis, PHX will have 564 remaining legacy working
interest wellbores.
Chad Stephens, President and CEO,
said, "These transactions are a continuation of our strategy to
high-grade PHX's asset base by divesting legacy working interest
wellbores and reinvesting the proceeds in higher-margin minerals in
our core areas of focus. Once these transactions are completed, we
will have divested approximately 75% of the wellbores in which PHX
owned a working interest when I became CEO in late 2019. While the
remaining working interest position will represent less than 10% of
our production volumes and reserves, we will continue to strive to
divest them at a fair price in 2023. The mineral acquisitions
funded with the proceeds from these transactions will continue to
drive increased royalty volumes and cash flow in the upcoming
quarters."
PHX Minerals Inc. (NYSE: PHX) Fort
Worth-based, PHX Minerals Inc. is a natural gas focused mineral
company with a strategy to proactively grow its mineral position in
its core focus areas. PHX owns mineral acreage principally located
in Oklahoma, Texas, Louisiana, North
Dakota and Arkansas. Additional information on the
Company can be found at www.phxmin.com.
Cautionary Statement Regarding
Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Words such as "anticipates," "plans," "estimates,"
"believes," "expects," "intends," "will," "should," "may" and
similar expressions may be used to identify forward-looking
statements. Forward-looking statements are not statements of
historical fact and reflect PHX's current views about future
events. Forward-looking statements may include, but are not limited
to, statements relating to: the Company's ability to execute its
business strategies; the volatility of realized natural gas and oil
prices; the level of production on the Company's properties;
estimates of quantities of natural gas, oil and NGL reserves and
their values; general economic or industry conditions; legislation
or regulatory requirements; conditions of the securities markets;
the Company's ability to raise capital; changes in accounting
principles, policies or guidelines; financial or political
instability; acts of war or terrorism; title defects in the
properties in which the Company invests; and other economic,
competitive, governmental, regulatory or technical factors
affecting properties, operations or prices. Although the Company
believes expectations reflected in these and other forward-looking
statements are reasonable, the Company can give no assurance such
expectations will prove to be correct. Such forward-looking
statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of the Company.
These forward-looking statements involve certain risks and
uncertainties that could cause the results to differ materially
from those expected by the Company's management. Information
concerning these risks and other factors can be found in the
Company's filings with the SEC, including its Annual Reports on
Form 10-K and Quarterly Reports on Form 10-Q, available on the
Company's website or the SEC's website at www.sec.gov.
Investors are cautioned that any such statements are not
guarantees of future performance and that actual results or
developments may differ materially from those projected in
forward-looking statements. The forward-looking statements in this
press release are made as of the date hereof, and the Company does
not undertake any obligation to update the forward-looking
statements as a result of new information, future events or
otherwise.
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SOURCE PHX MINERALS INC.