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Oxy to exit North Dakota's oil fields in sale to private equity fund
October 15, 2015 / 9:08 PM / 2 years ago

Oxy to exit North Dakota's oil fields in sale to private equity fund

DICKINSON, N.D./NEW YORK, Oct 15 (Reuters) - Occidental Petroleum Corp, the fourth-largest U.S. oil producer, has agreed to sell all of its North Dakota shale oil acreage and assets to private equity fund Lime Rock Resources in a deal worth around $500 million, according to sources familiar with the matter.

The sale, which marks the first exit of this downturn by a major oil company from the Bakken shale formation, encompasses all of Oxy’s more than 300,000 acres in the state, including a 21,000 square-foot regional office built just three years ago.

Lime Rock, which already operates in North Dakota, is buying the assets as the oil industry contends with the worst crude price crash in more than six years, a drop the fund used to its advantage.

As recently as last fall, Wall Street had expected Oxy’s Bakken assets to sell for more than $3 billion. The sharp drop in the deal’s value represents the most-significant pullback in valuation yet in the second-largest U.S. oil producing state.

Lime Rock is requiring all of Oxy’s North Dakota employees to re-apply for their jobs, according to one of the sources.

Lime Rock and Oxy, both of which are based in Houston, declined to comment. (Editing by Terry Wade)

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