The following information is provided by PetroDivest Advisors. All inquiries on the following listings should be directed to PetroDivest. Hart Energy is not a brokerage firm and does not endorse or facilitate any transactions.

MECO IV LLC retained PetroDivest Advisors to market for sale its oil and gas producing properties, leasehold, and overriding royalty interest (ORRI) in Pecos County, Texas.

The assets include legacy, vertical, operated production from Delaware Mountain Group reservoirs in addition to cost-free royalty interest in adjacent horizontal wells targeting Lower Avalon, Wolfcamp and Bone Spring reservoirs generating a resilient, high-margin cash flow stream from a diversified product mix on steady decline with further potential through behind-pipe and horizontal development.

Highlights:

  • Reliable, high-margin, diversified cash flow
    • Stable net PDP cash flow ($3.2 million next 12-month) from operated and ORRI sources
    • Diversified product mix (63% gas)
      • Benefits from recent improvements to both oil and gas pricing
    • High margins supplemented by cost-free royalty interest cash flow
      • ~$7/boe aggregate lifting costs
      • 76% net cash flow margin per boe
  • Working Interest Package
    • 133 net boe/d on 6% annual decline
    • 3,352 net acres (100% HBP) with access to Delaware Mountain Group targets
    • 49 wells (47 operated / two nonop)
      • 72% average working interest and 58% average royalty interest (PDP)
    • Net PDP PV-10: $7.3 million
    • Net PDP Next 12-month Cash Flow: $1.5 million
    • Coyanosa Field features a nine-well saltwater disposal system receiving third party volumes and generating an income of ~$230,000/year, offsetting field OPEX
    • Well-organized identification of behind-pipe potential opportunities with supporting well files
  • ORRI Package
    • 6.1% average royalty interest
    • Eight recent, high-interest, horizontal wells operated by Exxon, providing reliable future cash flow and performance from a premier operator
      • Net Production: 119 boe/d
      • Net PDP Next 12-month Cash Flow: $1.7 million
    • Net PDP PV-10: $6 million
    • Potential for further horizontal development through infill or additional target horizons
PetroDivest Marketed Map - MECO Pecos County Working Interest ORRI
(Source: PetroDivest Advisors)

Process Summary:

  • The assets are being offered in two distinct packages:
    • Working Interest: leasehold and 49 wells, primarily operated
    • ORRI: Royalty interest in eight Kriti C3-6-7 Unit wells
    • Proposals must be submitted by package
  • Evaluation materials available via the Virtual Data Room on Nov. 3
  • Proposals due on Dec. 1

For information visit petrodivest.com or contact Jerry Edrington, director of PetroDivest, at jerry@petrodivest.com or 713-595-1017.

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