Royale in deal to sell portion of Alaska acreage

Royale Energy Inc. said Nov. 10 that it has an agreement to sell a portion of its Alaska acreage for cash and a retained interest. The buyer was not named and Royale said the sale was subject to approval by the state.

The sale is for some 39,500 acres of the company’s 96,000 North Slope acres, an area Royale refers to as its western block. Royale said it will receive $2 million in cash and retain an overriding royalty interest. The buyer will acquire a 100 percent working interest in the acreage.

After acquiring North Slope acreage in 2011, Royale said it acquired and processed 3-D seismic data.

Royale will have a remaining 57,000 acres and said it is evaluating alternatives for that acreage “including similar de-risking, sale or joint venture.”

The company said this sale is “a key step in its plan to strengthen its balance sheet and regain compliance with Nasdaq listing requirements.”

Royale said in September that it had reached an agreement with Rampart Energy to repurchase Rampart’s 30 percent interest in the western block, bringing Royale’s interest in its 96,000 North Slope acres back to 100 percent and securing its exclusive rights to proprietary seismic data.

Royale said Oct. 9 that it had received a letter from the Nasdaq listing qualifications staff notifying the company that it was non-compliant with the stockholders’ equity, majority independent director and audit committee requirements for continued listing. The company said then that it planned to request a hearing and present a plan to regain and sustain compliance with all applicable listing requirements.

- KRISTEN NELSON