The Sundance Energy Australia Ltd (ASX: SEA) share price is worth watching this morning as the group announced the sale of its Dimmit County assets in Texas, USA, before market open.
What was in Sundance's announcement?
Sundance announced that it had entered into a definitive agreement to sell its assets in Dimmit County, Texas for a purchase price of US$29.5 million (A$42.1 million), subject to customary adjustments at closing.
The assets comprise 19 gross producing wells on ~6,100 net acres and contributed 1,051 barrels of oil equivalent (boepd) in average daily sales volumes for the first quarter of 2019.
The sale is anticipated to close prior to the end of September 2019.
In anticipation of the transaction sale, the company has recently announced that the ~40% increase to its borrowing base facility did not include any reserves associated with the assets in the calculation of the borrowing base, and it will therefore remain unchanged upon the close of the sale.
Given the company's previously released public guidance excluded any contribution from the assets beginning in May 2019, the Sundance share price could rise on the anticipated earnings contribution from the sale (if minor).
How has the Sundance share price performed so far this year?
Sundance Australia is a wholly owned subsidiary of the United States (US) parent company, Sundance Energy Inc, located in Denver, Colorado.
The Sundance share price plummeted 7.7% on the ASX yesterday and is currently trading at $0.24 per share, 31.4% lower on its start-of-year valuation.
The company has seen all of those year-to-date (YTD) losses accumulate since June, which has come hot on the heels of its annual general meeting (AGM) results, its first quarter earnings and an increase in its borrowing base.
Sundance received 35.88% of votes at the AGM cast against the adoption of its remuneration report and therefore a conditional spill resolution was also required, with 88.18% of votes voting against a spill.
Aussie energy stocks have been performing well in 2019, with the share prices of Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) soaring 52.9% and 33.3% higher so far this year, respectively.
