Linn Energy Inc. in Houston has announced a plan to split into two companies this year in a move that will affect operations in Oklahoma. The announcement came a year after the company was formed following the emergence from bankruptcy by Linn Energy LLC.
With a main focus on what it describes as the “development of the Merge/SCOOP/STACK in Oklahoma,” the company intends to split into two companies—-Riviera and Roan.
Roan Resources LLC has managed the Linn Energy operations in Oklahoma. But Linn’s assets in East Texas, Louisiana, the Midwest and Mid-Continent will join the company’s Blue Mountain Midstream pipeline under the name of Riviera Resources. Riviera will also retain more than 100,000 acres in the prospective NW Stack play.
But the main assets in Oklahoma will be retained under the new name Roan Resources.
“LINN will hold 100 percent of the equity interest in Roan Resources,” a statement said.
The company has already spun off Berry Petroleum and has an agreement to sell off its Permian Basin assets to bolster the budget after emerging from bankruptcy last year.
Linn President Mark Ellis will leave under the new plan, as will many of those in the current top management tier, the company said.
Arden Walker, Executive Vice President and Chief Operating Officer; Thomas Emmons, Senior Vice President, Corporate Services; Jamin McNeil, Senior Vice President, Houston Division Operations; and Candice Wells, Senior Vice President, General Counsel and Corporate Secretary, all intend to leave when the spinoffs are completed.
Linn’s current CFO, David Rottino, becomes the CEO of Riviera.
Tony Maranto, who has two decades of experience as a VP and GM at EOG Resources, takes over as CEO of Roan.
Meanwhile, it was revealed Thursday that on the same day Linn exited bankruptcy in February of 2017, Ellis received a $60 million compensation package.
“Ellis’s pay included an equity grant worth $58 million, split between restricted shares and so-called Class B units, which are classified as profit interests for tax purposes, according to a regulatory filing Wednesday.”
Rottino and Chief Operating Officer Arden Walker each received awards of $24.7 million at that time, Bloomberg reported.