Carrizo Oil & Gas, Inc. (CRZO) announced the closing of the sale of the majority of its mineral lease position in the northern portion of the Utica Shale play to an unrelated third party for net cash proceeds of $43 million. Immediately preceding the property sale, Carrizo elected to exercise a mineral lease purchase option to increase its ownership from a 10% to a 50% undivided interest in the same properties from a subsidiary of its financial partner, Avista Capital Holdings, L.P. The mineral leases are located in Mercer and Crawford Counties in Pennsylvania and Trumbull County in Ohio. The net cash proceeds realized by Carrizo from these transactions are subject to customary post-sale adjustments. Other assets included in the sale are an existing drilling pad and approved well drilling permits associated with the leases.
Carrizo will continue to own a 10% undivided interest, along with a similar option to increase its ownership to 50%, in nearly 26,000 additional gross acres located in the southern portion of the play, primarily in Guernsey County, Ohio, in proximity to recent encouraging industry drilling results.
