Tulsa’s Unit Corporation announced Wednesday its sale of its drilling subsidiary in a $120 million agreement with Cactus Drilling Company, L.L.C.
It was an all-cash deal to selling Unit Drilling Company and approved by Unit’s board of directors.
“Divesting our contract drilling business allows us to sharpen our strategic focus on our upstream operations, where we see significant opportunities to create long-term value,” said Phil Frohlich, the Company’s CEO.
“We remain committed to disciplined capital allocation, returning cash to shareholders through our dividend program, and pursuing attractive drilling prospects that complement our existing portfolio.”
Specific uses of the proceeds from the transaction will be determined by the Board in the future. The Company currently expects that its available tax attributes will substantially offset the gains from this transaction.
The Company will continue to operate its upstream oil and gas segment and will evaluate opportunities to invest in new drilling projects to drive future growth. The Company also intends to continue its regular dividend program subject to the Board’s discretion.
Unit Corporation is a Tulsa-based, publicly held energy company engaged through its subsidiary, Unit Petroleum Company, in oil and gas production.
Cactus Drilling is known as the nation’s largest privately-held land drilling contractor with 1,225 team members and 37 contracted rigs. It operates in four basins and has Oklahoma City operations headquartered on SW 15th street. Ten of the rigs are contracted in Oklahoma, six in Louisiana, eight in New Mexico and 15 in Texas.
