PETROQUEST ENERGY, INC. (OTCMKTS:PTQEP) Files An 8-K Entry into a Material Definitive AgreementItem 1.01 Entry into a Material Definitive Agreement
On January 31, 2018, PetroQuest Energy, L.L.C. (“PQLLC”), a direct subsidiary of PetroQuest Energy, Inc. (the “Company”), entered into a purchase and sale agreement (the “PSA”), with Northstar Offshore Ventures LLC (“NOV”), to which PQLLC sold certain producing oil and gas assets located in the Gulf of Mexico (the “Assets”) effective as of December 1, 2017 (the “Transaction”). As a result of the Transaction, the Company has eliminated an approximate $35.4 million undiscounted abandonment liability from its long-term obligations. PQLLC received no proceeds from the sale of the Assets and is required to contribute $3.75 million towards future abandonment costs. However, as a result of the Transaction, PQLLC expects to receive a cash refund of approximately $10.3 million related to a depositary account that served to collateralize a portion of the Company’s bonds used to satisfy federal bonding requirements. to the PSA, in the event that NOV does not materially comply with its obligations to post all required replacement bonds, letters of credit, guarantees and/or other security within a reasonable time after the closing of the Transaction, PQLLC shall have the right, in addition to its other rights and remedies under the PSA, to terminate the PSA and rescind the Transaction.
The PSA contains customary representations, warranties and covenants for a transaction of this type. PQLLC and NOV have generally agreed to indemnify each other for breaches of the representations, warranties, and covenants contained in the PSA and certain liabilities, subject to certain deductibles and caps.
Item 2.02 Results of Operations and Financial Condition
OnFebruary 1, 2018, the Company issued a news release announcing the Transaction and its reserves estimates and certain other operating results for the year ended December31, 2017. The news release is furnished as Exhibit 99.1 to this report.
In accordance with General Instruction B.2 of Form 8-K, the information set forth in the attached Exhibit 99.1 is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit NumberDescription of Exhibit
PETROQUEST ENERGY INC ExhibitEX-99.1 2 pr2017reservesandgomsale.htm EXHIBIT 99.1 Exhibit NEWS RELEASEFor further information,…To view the full exhibit click here
About PETROQUEST ENERGY, INC. (OTCMKTS:PTQEP)
PetroQuest Energy, Inc. is an oil and gas company. The Company is engaged in exploratory, development and acquisition activities. The Company has approximately 30 gross exploratory wells and over 30 gross development wells. The Company has reserves in various areas, including East Texas, Gulf Coast Basin and Oklahoma Woodford. Its annual production from East Texas area is approximately 114.1 billions of cubic feet equivalent (Bcfe); Gulf Coast Basin is over 43.9 Bcfe, and Oklahoma Woodford is approximately 20.0 Bcfe. The net production from its East Texas assets averages over 30.4 millions of cubic feet equivalent (MMcfe) per day. Production from Gulf Coast Basin area totals approximately 37.8 MMcfe per day. The average daily production from its Oklahoma-Woodford properties totals over 25 MMcfe per day. The Company sells its oil and natural gas production under fixed or floating market contracts.
