California Resources Corporation (NYSE:CRC) announced on September 17 that it had agreed to sell its Uinta Basin assets, located mostly in Utah and Colorado, to an undisclosed buyer for $90 million in cash. The company had come to own the Uinta assets, which span about 100,000 net acres, after it acquired Berry Corp last year. However, CRC considered them non-core to its operations. The net proceeds from the sale will be used for shareholder returns and other corporate purposes.
Francisco Leon, President and CEO of California Resources Corporation, commented:
“Today’s transaction strengthens our business. The monetization of our Uinta Basin assets sharpens our focus on California and captures additional value from the Berry merger. This transaction enhances our capital allocation flexibility, allowing us to invest in higher-return opportunities within the Golden State and supports our shareholder return strategy. The sale also helps offset the purchase price of our recent midstream transaction.”
The transaction is expected to close by year-end, subject to the receipt of certain third-party consents and other customary conditions.
CRC Cashes Out of Costly Uinta:
The sale will allow CRC to redeploy the $90 million toward assets that are central to its operating strategy while avoiding additional capital commitments to Uinta. The company already stated in its Q2 earnings call that Uinta has higher capital intensity, higher break-evens, lower crude quality, higher transportation and operating costs, and steeper declines. Therefore, the sale removes a portfolio distraction at a time when CRC is concentrating investment in California infrastructure and production.
Additionally, Uita contributed only 2.5% of CRC’s oil production and roughly 8% of its total natural gas production in the second quarter, so the sale should not fundamentally alter the company’s broader production profile.
The proceeds from this sale will also help offset the $63 million purchase price of CRC’s recent acquisition of Crimson Midstream Holdings from CorEnergy Infrastructure Trust. The purchase of those pipelines and other operations is also expected to close later this month.
Is CRC Trading Future Upside for Cash?
While the $90 million proceeds are useful, they are unlikely to materially transform CRC’s balance sheet or earnings profile. The financial benefit will ultimately depend on whether the company can generate higher value by redeploying the proceeds or returning them to shareholders.
There is also a risk that CRC may be divesting Uinta before fully realizing the full value of its asset base, as the company’s management had previously described it as having meaningful development potential.
Conclusion:
The $90 million sale of Uinta Basin assets should benefit CRC by monetizing a higher-cost, non-core asset while freeing up capital for its California operations. With Uinta contributing a small share of its total oil and gas production, the strategic move should have limited operational impact while helping offset the $63 million Crimson Midstream acquisition.
Market Sentiment:
California Resources Corporation was held by 37 hedge funds at the end of Q2 2026 in the Insider Monkey database, with a total investment value of almost $660 million. This is down from 40 hedge fund investors with a cumulative stake value of just over $907 million in the previous quarter.
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This article is originally published at Insider Monkey.
