Sinochem Petroleum USA LLC will buy 40 percent of Pioneer Natural Resources Co.’s (NYSE: PXD) interest in the Wolfcamp Shale play for $1.7 billion.

Oil exploration and production company Pioneer, headquartered in Irving, Texas, leases 207,000 acres in the southern portion of the Wolfcamp Shale play. It will retain the remaining 60 percent of the interests.

At closing, Sinochem will pay Pioneer $500 million in cash and will pay the remaining $1.2 billion by carrying a portion of Pioneer’s share of future drilling and facilities costs.

Beijing-based Sinochem is an energy company that explores for and refines oil.

Bank of America Merrill Lynch was financial adviser, and Vinson & Elkins was legal counsel to Pioneer on the deal. Mayer Brown LLP was Sinochem's legal counsel.

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