Occidental Petroleum has entered into an agreement to divest Wyoming, Colorado and Utah land grant assets to Orion Mine Finance for approximately $1.33 billion. The transaction, which is expected to close in the fourth quarter of 2020, has a footprint of 4.5 million mineral acres and 1 million fee surface acres. Occidental will retain all cash flow from currently producing oil and gas properties on the position, which are primarily cost-free royalties.

Not included in the sale is approximately 2.5 million mineral acres derived from the land grant in Colorado, including Occidental’s core DJ Basin position.

“This transaction significantly advances the progress against our $2 billion plus divestiture target for 2020,” President and CEO Vicki Hollub said. “We will retain our core oil and gas assets in the Rockies, including the prolific DJ Basin in Colorado and the highly prospective Powder River Basin in Wyoming.”

In this transaction, Orion is acquiring mineral rights to the world’s largest known trona deposit.

“Acquiring high-quality-producing royalties is a core component of our investment strategy and we are thrilled to be partnering with Occidental in this transaction,” Orion Chief Investment Officer Oskar Lewnowski said. “This transaction offers significant royalty cash flow from the trona mines and has strong potential for mineral development.”

Occidental Petroleum acquired the property, which originally belonged to Union Pacific, when they bought Anadarko Petroleum. The U.S. government granted to the Union Pacific railroad every other section of land for 12 miles on both the north and south sides of the original Transcontinental Railroad as an incentive to build it. Much of the land was sold to homesteaders, but a large swath through Wyoming and eastern Utah was never sold.

Occidental put the property up for sale earlier this year and the state of Wyoming bid $1.2 billion for it and Orion topped that bid. Orion said it will place the properties under Sweetwater Royalties, a new base metals and industrial minerals royalty company, managed by Orion.