Denbury Resources rises on ConocoPhillips deal
Denbury Resources shares rise 5 percent after oil land deal with ConocoPhillips
NEW YORK (AP) -- Shares of Denbury Resources rose on Tuesday after it said a subsidiary will buy properties in North Dakota and Montana for $1.05 billion from ConocoPhillips.
THE SPARK: The Plano, Texas oil and natural gas company said it will pay for the deal with part of the $1.3 billion in cash it got from the first phase of its deal to sell its holdings in the Bakken oil field to Exxon Mobil Corp., which closed in December.
THE BIG PICTURE: Oil companies are jockeying for position in the Bakken oil fields, as they try to get onto the properties that are the best fit with their business. Denbury said the deal announced Tuesday gets them focused on the type of oil recovery they do best. The deal is expected to close in the first quarter.
Sterne Agee analyst Tim Rezvan wrote that the deal is also a tax move because it defers most of the $500 million in cash taxes the company faced on the sale and swap of its Bakken assets.
SHARE ACTION: Up 88 cents, or 5.2 percent, to close at $17.76. Over the past year they've traded between $13.13 and $21.37.
