Like many Permian E&Ps, Apache Corp. (NYSE: APA) continues to unlock value through asset sales as it builds momentum in the basin.

On June 1, Apache agreed to sell light oil assets in Western Canada to Calgary, Alberta-based Cardinal Energy Ltd. for C$330 million (US$244.5 million) in cash, an Apache spokesperson confirmed to Hart Energy.

The deal comprises Apache’s House Mountain assets in Alberta and the company’s stake in the Weyburn/Midale area of southeast Saskatchewan and includes 5,000 barrels of oil equivalent per day of light oil production.

“The sale of these assets is in line with Apache’s efforts to further streamline its portfolio and focus on our high-growth areas of opportunity, particularly in the Permian Basin,” the Apache spokesperson said.

For 2017, Apache expects to exceed anticipated operating cash flow after capex shot up 64% from last year to $3.1 billion. Nearly two-thirds, or roughly $2 billion, of the capex will be directed to the Permian Basin.

The deal follows months of divestitures by companies looking to increase their capex in the Permian or pay down debt from previous purchases in the basin.

In March, Pioneer Natural Resources Co. (NYSE: PXD) agreed to sell acreage in Martin County, Texas, for $266 million, in part to offset a purchase from Devon Energy Corp. (NYSE: DVN).

A crew works on the drill floor of a rig in Apache Canada’s House Mountain operating area.

In January, Anadarko Petroleum Corp. (NYSE: APC) agreed to sell its 155,000-net-acre Eagle Ford position for about $2.3 billion. Since January 2016, Anadarko has closed or announced divestitures of more than $8.1 billion as it focuses on the Delaware and Denver-Julesburg basins.

Tudor, Pickering, Holt & Co. (TPH) said Apache’s sale of Canadian assets will help to fill the company’s modest outspend gap.

“Transaction exemplifies what management has said around filling its planned, modest 2017 outspend gap with relatively smaller deals, with Alpine High, other Permian, and Egypt remaining the pecking order for general capital allocation,” TPH said in a June 2 report. “At the same time, conservative budgeting and international cash flow generation in the near-term allow [the] company to be patient with timing.”

At the end of first-quarter 2017, Apache’s net debt position was down $200 million to under $7 billion driven by asset sales, which included $440 million from two noncore Permian acreage transactions and $26 million in other noncore divestitures closed during the quarter.

Apache has plenty of opportunity for additional divestitures, according to TPH, given the company’s exposure in the Midcontinent, East Texas Eagle Ford and Permian outside the Alpine High area. Though, Apache isn’t currently planning for a steady stream of divestitures.

Instead, John J. Christmann, Apache CEO and president, said the company’s asset sales are more opportunistically driven.

“As we build out more optionality and more inventory, there are things that we look at today that in the past we might have thought we would’ve funded that we won’t get to,” Christmann said during an earnings call on May 4.

Christmann said the company hasn’t set out any specific assets that might be on the table for future divestiture.

“I’ll just say we're actively looking at our portfolio and managing it, and it would be more [opportunistic] in terms of what we decide to put out there,” he said.

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Cardinal anticipates selling royalty interests and fee title lands associated with the assets prior to year-end, the company said. The proceeds will be applied to repay all or part of the purchase price funded by the company’s credit facilities.

The deal also adds more than 300 light oil drilling locations, Cardinal said.

The acquisition will be funded with C$170 million bought deal financing and by Cardinal's credit facilities. Cardinal expects its available lending limit will increase to C$325 million following the closing of the acquisition.

The deal should close by June 30, Cardinal said. The transaction’s effective date is Jan. 1. (C$1 = US$0.74)

Emily Patsy can be reached at epatsy@hartenergy.com.