PHX Minerals Announces Closing of Previously Announced Working Interest Divestiture and Additional Mineral Acquisitions

Rhea-AI Summary

PHX Minerals Inc. (NYSE: PHX) has completed the divestiture of 210 legacy non-operated working interest wellbores in the Fayetteville Shale for $6,050,000. This sale reduces the company's asset retirement obligations by approximately $212,000. In a strategic move, PHX also acquired 575 net royalty acres in Louisiana for $6,226,489, redeploying the funds from the divestiture. These transactions aim to enhance the asset base by focusing on higher-margin royalty minerals in active natural gas production areas, potentially increasing cash flows in future quarters.

Positive

• Successful divestiture of 210 legacy wellbores enhances balance sheet by reducing asset retirement obligations by $212,000.
• Acquisition of 575 net royalty acres in Louisiana allows for reinvestment of proceeds from the divestiture, focusing on higher-margin royalty minerals.
• The new acquisitions are located in active drilling areas, potentially increasing future royalty volumes and cash flows.

Negative

• None.

FORT WORTH, Texas, Oct. 12, 2022 /PRNewswire/ -- PHX Minerals Inc., (NYSE: PHX), today announced that it has closed on the previously announced sale of all its remaining legacy non-operated working interest wellbores in the Fayetteville Shale play in Arkansas to an undisclosed buyer for a total of $6,050,000. This divestiture represents 210 gross legacy wellbores and removes approximately $212,000 in asset retirement obligation from the Company's balance sheet. On a pro forma basis, PHX has 789 gross legacy non-operated working interest wellbores remaining.

Additionally, PHX completed the acquisition of approximately 575 net royalty acres located primarily in Caddo and DeSoto Parishes, Louisiana, for $6,226,489. These acquisitions are predominately located in the same focus area of the Haynesville Shale as the Company's previously closed royalty acreage acquisitions where drilling activity continues to accelerate. The new royalty acreage acquisitions represent a full redeployment of net proceeds received by the Company for the working interest divestiture.

Chad Stephens, President and CEO, said, "These transactions are a continuation of our strategy to high grade PHX's asset base by divesting legacy non-operated working interest wellbores and reinvesting the proceeds in higher margin royalty minerals in our core areas of focus.

"Also, we anticipate the core focus areas in which we are acquiring minerals to be the leading basins in U.S. natural gas production growth over the next several years. Reputable, well-capitalized operators are actively developing these areas. As such, we expect royalty volumes to continue to increase from the development of acquired minerals in future quarters, which will drive higher future cash flows."

PHX Minerals Inc. (NYSE: PHX) Fort Worth-based, PHX Minerals Inc. is a natural gas and oil mineral company with a strategy to proactively grow its mineral position in its core areas of focus. PHX owns mineral acreage principally located in Oklahoma, Texas, Louisiana, North Dakota and Arkansas.  Additional information on the Company can be found at www.phxmin.com.

View original content:https://www.prnewswire.com/news-releases/phx-minerals-announces-closing-of-previously-announced-working-interest-divestiture-and-additional-mineral-acquisitions-301647575.html

SOURCE PHX MINERALS INC.

FAQ

What did PHX Minerals announce on October 12, 2022?

PHX Minerals announced the closure of the sale of its remaining legacy non-operated working interest wellbores and the acquisition of royalty acres.

How much did PHX Minerals sell its legacy wellbores for?

PHX Minerals sold its legacy wellbores for a total of $6,050,000.

What was the purpose of PHX Minerals' recent acquisitions?

The acquisitions aimed to reinvest proceeds from the divestiture into higher-margin royalty minerals in strategic areas.

What is the anticipated impact of these transactions on PHX Minerals?

The company expects increased royalty volumes and cash flows from the newly acquired mineral interests.