California Resources Partnership to Drill Wells

California Resources Corp., the state’s largest oil and gas producer, has announced a second partnership to develop its existing oil and gas wells in the state. The Chatsworth company has formed a joint venture with Macquarie Infrastructure and Real Assets, an asset management arm of the Australian global banking and financial advisory firm Macquarie Group Ltd. Macquarie will contribute $160 million for two years, and potentially up to $300 million, to develop wells in the San Joaquin Basin. Initially, the funds will be used in the Kern Front, Mount Poso, Pleito Ranch and Wheeler Ridge fields, and Macquarie will pay for 100 percent of the development wells. The majority of CRC’s wells are in the San Joaquin Basin. In a statement, CRC’s Chief Executive Todd Stevens said, “We are pleased to partner with MIRA to bring forward the value of our large and long-lived inventory and help to de-risk and accelerate the development of CRC’s vast resource base.” He added the venture would also help the company grow its production and cash flow while assisting with its deleveraging efforts. The partnership is the second CRC announced this year. In February, the producer announced it had partnered with Benefit Street Partners, the credit investment division of Providence Equity Partners, which was to invest up to $250 million, with an initial $50 million directed toward drilling. Subsequent investments will come in tranches up to $50 million at the discretion of the partners over two years. Shares of California Resources (CRC) closed Wednesday down 71 cents, or 5.7 percent, to $11.73 on the New York Stock Exchange.