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April 13 (Reuters) – ConocoPhillips, the largest independent U.S. oil producer, said Thursday it will sell natural gas-laden assets in the San Juan Basin to privately held Hilcorp Energy Co for about $ 3 billion.
ConocoPhillips sold assets to reduce its exposure to profit-eating natural gas assets and to prop up its balance sheet.
The assets, which span New Mexico and southwest Colorado, produced 124,000 barrels of oil equivalent per day, about 80 percent of which was natural gas, ConocoPhillips said.
Conoco announced last month that it would sell tar sands and western Canadian natural gas assets to Cenovus Energy Inc. for $ 13.3 billion.
Conoco receives $ 2.7 billion in cash from the sale of assets in the San Juan Basin, which is expected to close in the third quarter.
The deal also includes a contingent payment of up to $ 300 million.
Conoco, which said the assets sold had a book value of approximately $ 5.9 billion at the end of 2016, expects an impairment in the second quarter.
Houston-based Hilcorp has partnered with private equity firm Carlyle Group LP to acquire and develop North American oil and gas properties. (Reporting by Ahmed Farhatha in Bengaluru; editing by Sriraj Kalluvila)
