Permian Resources continues to make moves in its core acreage areas in the Delaware Basin and progress realizing synergies related to its $4.5 billion acquisition of Earthstone Energy, the company said in a May 7 earnings release.
The company raised its tally of first-quarter acquisitions to about $270 million. In January, the company said it would acquire Delaware leasehold in two bolt-on deals. The two transactions added 11,500 net leasehold acres and 4,000 net royalty acres in Eddy County, New Mexico, for $175 million.
Permian Resources said it continues to strengthen its acreage position in the core of the Delaware through bolt-on acquisitions and additional properties acquired through its ongoing grassroots program.
The bolt-on deals, from undisclosed third-party sellers, consist of predominantly undeveloped acreage offset by Permian Resources' “highly capital efficient Parkway asset,” the company said.
Inventory on the acquired acreage comprises two-mile locations with high net revenue interests, which the company said would immediately compete for capital. The company closed one transaction during the first quarter. The second is pending and expected to close late in the second quarter.
"The acquired acreage is analogous to our high-quality Parkway position. This area represents one of the highest returning assets within our portfolio, with returns driven by reduced D&C costs and strong oil cuts. We are excited to begin development on the acquired acreage later this year," said Co-CEO Will Hickey.
Permian Resources also continues to execute on its ground game through smaller grassroots acquisitions and leasehold transactions. During the first quarter, the company completed approximately 150 grassroots leasing and working interest acquisitions. The majority of these acquisitions are slated for near-term development, making them highly accretive, the company said.
Through the combined efforts, the company said it had added approximately 11,200 net leasehold acres and 4,500 net royalty acres—slightly less leasehold and more royalty acres than disclosed in January. Permian Resources said the acquisitions were transacted at approximately $9,500 per net leasehold acre and approximately $5,000 per net royalty acre after adjusting for production value. Permian Resources has identified approximately 110 gross operated locations on the acquired properties. In total, these acquisitions contributed less than 100 boe/d of total production in the first quarter.
Permian Resources additionally reported that the integration of its $4.5 billion Earthstone deal is ahead of schedule. Permian Resources, which acquired Earthstone in November, upped its annual synergy target from the deal by $50 million to $225 million.
Recommended Reading
Global Partners Buys Four Liquid Energy Terminals from Gulf Oil
2024-04-10 - Global Partners initially set out to buy five terminals from Gulf Oil but the purchase of a terminal in Portland was abandoned after antitrust concerns were raised by the FTC and the Maine attorney general.
ONEOK CEO: ‘Huge Competitive Advantage’ to Upping Permian NGL Capacity
2024-03-27 - ONEOK is getting deeper into refined products and adding new crude pipelines through an $18.8 billion acquisition of Magellan Midstream. But the Tulsa company aims to capitalize on NGL output growth with expansion projects in the Permian and Rockies.
Infrastructure Company Savage Acquires Houston’s Texon
2024-05-03 - Texon, a midstream service provider, will continue operations under its legacy brand.
TotalEnergies, Sinopec to Develop SAF Unit in China
2024-03-26 - TotalEnergies and Sinopec’s production unit will have the capacity to produce 230,000 tons of sustainable aviation fuel per year.
FTC OKs Exxon-Pioneer Merger, but Bars Sheffield from Exxon’s Board
2024-05-02 - A megamerger between Exxon Mobil and Pioneer Natural Resources can proceed, but Pioneer Chairman Scott Sheffield is out, the Federal Trade Commission says.