Penn West to sell Mitsue properties for C$192.5 million

CALGARY, Alberta -- Penn West Petroleum has entered into a definitive agreement for the sale of its properties in the Greater Mitsue area of Central Alberta for a cash consideration of C$192.5 million.

Proceeds from the sale will be used to reduce the company’s senior debt.  Upon completion of the sale of its Mitsue properties, Penn West will have raised approximately C$605 million in total proceeds this year through its non-core asset disposition program.  

In addition, since the end of second-quarter 2013, Penn West will have divested an estimated 34,000 boed of non-core assets for proceeds of approximately C$1.7 billion, which has allowed the company to reduce its debt by approximately C$1.4 billion, representing a reduction of more than 40%. 

"Despite the current weakness in commodity prices, we continue to demonstrate the ability to complete non-core asset dispositions at attractive deal metrics,” David Dyck, senior V.P. and CFO of Penn West, said. “We believe that our non-core assets offer value to buyers who are better positioned to realize their potential."

The effective date for the sale of the Mitsue properties will be July 1, 2015. Closing is expected to occur during the fourth quarter of 2015.