Magnum Hunter Resources Corporation has executed a definitive agreement with a Canadian private company to sell 100% of its ownership interest in the Company's Canadian subsidiary, whose assets consist primarily of oil and gas properties located in the Tableland Field in Saskatchewan, Canada, for a purchase price of $75 million (Canadian -- or approximately $67.5 million (US) at the current exchange rate), subject to customary purchase price adjustments with an effective date of March 1, 2014. The transaction is expected to close on or about May 12, 2014. The closing is subject to the satisfaction of customary closing conditions. As announced earlier, Magnum Hunter previously sold primarily all its Alberta, Canada oil and gas properties in April 2014. The Company's sale of its Canadian subsidiary will complete Magnum Hunter's goal of exiting and divesting all of the Company's Canadian assets.
The assets sold include 52,520 gross (49,470 net) acres located in Saskatchewan, Canada with 84 gross producing wells and approximately 630 Boe per day of current net production. The Company intends to use the net proceeds from this sale to pay down outstanding borrowings under its Senior Revolving Credit Facility and for general corporate purposes.
The closing of the sale of the Company's remaining Canadian properties will represent a further step by the Company in its strategy to identify and monetize non-core assets, and reallocate its resources primarily to its existing (and anticipated future additional) properties and operations (including its midstream operations) in the Marcellus Shale and Utica Shale in West Virginia and Ohio, which the Company believes offer the opportunity for more attractive returns on invested capital. The Company continues to evaluate its existing asset base and believes that a focus on core assets, such as its Marcellus Shale and Utica Shale properties, is essential for the success of its future business plans which should provide for exceptional production and reserve growth. Today's announcement is seen as an additional step in helping ensure that the Company's asset mix will provide the Company with the best possibilities for future value creation.