Stone Energy, EQT close on $527 million sale of Appalachia properties

By Caroline Salls

Pittsburgh, Feb. 27 – Stone Energy Corp. closed on the $527 million sale of its Appalachia properties to EQT Corp. through its wholly owned subsidiary EQT Production Co., according to a news release.

Stone said the assets include 86,000 net acres in the Appalachian regions of Pennsylvania and West Virginia.

The purchase price is subject to an up to $16 million adjustment and other customary purchase price adjustments.

Under the purchase agreement, the sale is effective retroactive to June 1, 2016.

Stone Energy said it will use a portion of the cash consideration to fund its cash payment obligations under its second amended joint pre-packaged plan of reorganization, which was confirmed on Feb. 15 by the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, the company currently expects the plan to take effect on Feb. 28.

Upon the close of the sale to EQT, the company said the purchase and sale agreement with TH Exploration III, LLC, an affiliate of Tug Hill, Inc., terminated, and Stone used a portion of the cash consideration received to pay Tug Hill a break-up fee of $10.8 million.

Stone Energy is a Lafayette, La., oil and gas exploration and production company. The company filed bankruptcy on Dec. 14 under Chapter 11 case number 16-36390.

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