Plains Exploration & Production said Monday it would sell some oil and natural gas properties to Occidental Petroleum and XTO Energy for $1.75 billion.
Houston-based Plains also said its board of directors approved an increase in its share buyback authorization to $1.0 billion and a $1.15 billion capital budget for 2008.
Included in the asset sales totaling $1.55 billion to Occidental are Plains' 50-percent interest in Permian Basin properties in West Texas and New Mexico. Occidental will take over as operator of those fields, while Plains will continue to hold a 50 percent stake.
Occidental will also buy 50 percent of Plains' stake in properties in Colorado's Piceance Basin, although Plains will remain the operator of those areas with a 50 percent stake.
The Permian Basin properties currently produce about 18,000 barrels of oil equivalent per day from a proved reserve base of 91 million barrels. The Piceance Basin properties are producing 9,000 boe per day from a proved reserve base of 64 million boe.
XTO will pay Plains $180 million for properties in the San Juan Basin in New Mexico and Barnett Shale in Texas that are currently producing about 3,000 boe per day from the total of 17 million in proved reserves.
Plains will also receive XTO's 50 percent stake in the "Big Mac" prospect on Texas' Gulf Coast.
The company's plan to spend $1.15 billion on capital projects next year represents an increase from its projected 2007 capital spending of between $850 million and $950 million.
If oil prices averaged $90 a barrel and natural gas prices averaged $7 per thousand cubic feet next year, the company expects it would buy back about $400 million of shares in 2008 under its new repurchase program.
Shares of Plains rose 74 cents, or 1.4 percent, to $55.04 in afternoon trading on the New York Stock Exchange.