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Enerplus has closed on the previously announced sale of its “non-strategic” assets in Montana and North Dakota.

The acreage, in Montana’s Sleeping Giant Field and North Dakota’s Russian Creek area, were sold for $115 million, before customary closing adjustments. Enerplus will also receive up to $5 million in contingency payments, if WTI oil prices average over $65 per barrel in 2022 and over US $60 per barrel in 2023.

The assets Enerplus sold generated about 3,00 barrels of oil per day, 77 percent of which were crude oil and natural gas liquids, in the second quarter of 2021 with around 244 net wells. The operating income for the wells is $22 million based on a $60 WTI oil price.

Enerplus President and CEO Ian Dundas said at the time the sale was announced that the assets were not attracting capital in the company’s portfolio.

“(The sale) brings significant value forward and accelerates our debt reduction plans,” he said then in a media release. “We now estimate that we will achieve our $400 million debt reduction target by the end of the first quarter of 2022, based on the current commodity price environment. While debt reduction remains our priority, we believe our shares are trading in an attractive price range, and, as a result, we plan to direct approximately 10 percent of the sale proceeds to incremental share repurchases.”

Enerplus’ next earnings call has been set for 10 a.m. CST Nov. 5, and is likely to include an update on the impact of the recent sale.

Enerplus has twice purchased Williston Basin assets in 2021, which has made it a powerhouse in the Bakken. The first purchase was for 151,000 net acres from Bruin E&P for $465 million in cash. That included 67,000 acres in Williams County and 30,000 acres in Fort Berthold.

The second purchase, from Hess, included a net 78,700 acres in Dunn county, some of which were already contiguous to Enerplus assets. Together, those purchases deepened the company’s drivable wells by 269 right in the core of the Bakken.

In its five-year outlook, Enerplus projects cumulative free cash flow of between $1.2 to $1.8 billion from 2021 to 2025, assuming WTI of $50 to $55 per barrel.

Enerplus is an independent North American oil and gas exploration and production company with a majority of its holdings in the Williston Basin, where it holds 296,000 net acres in North Dakota. It also has minority positions in the Marcellus natural gas shale play in Pennsylvania. And older oil assets under secondary and tertiary recovery in western Canada.

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