Denbury Resources Inc. has announced that the company has entered into an agreement to sell its stake in Encore Energy Partners LP to Vanguard Natural Resources, LLC for an amount of $380 million. The company is selling its interest in the entity which owns 100% of ENP's general partner's interest.
$80 million of the total consideration will be paid by Vanguard in the sale may be paid in Vanguard common units, at the option of Vanguard.
Production attributable to ENP averaged 8,630 barrels of oil equivalent per day during the third quarter of 2010. This transaction is expected to be over by December 31, 2010. The Company plans to use the proceeds from the sale to repay outstanding bank debt and to fund any shortfall between its anticipated cash flows from operations and planned capital expenditures during 2011.