Texas Pacific Land Corp. closed a pair of Permian Basin acquisitions, the company said on Aug. 27. (Source: Shutterstock, Texas Pacific Land Corp.)
Texas Pacific Land Corp. (TPL) closed a pair of Permian Basin acquisitions—one for oil and gas mineral interests in the Delaware Basin, the other for Midland Basin surface acreage—for a combined $169 million cash.
TPL acquired mineral interests across approximately 4,106 net royalty acres located in northern Culberson County, Texas, the company said on Aug. 27. The mineral interests, leased and operated by Coterra Energy, overlap existing TPL royalty acreage in current and anticipated drilling and spacing units, “enhancing TPL’s net revenue interests in existing and future oil and gas wells,” the company said.
The acquired mineral interests also overlap with TPL’s surface acreage.
TPL also acquired approximately 4,120 surface acres in Martin County, Texas, in the core of the Midland Basin.
The asset generates numerous revenue streams across water supply, produced water disposal and multiple other surface-related activities, including royalties from a solid waste landfill owned and operated by Waste Connections, TPL said. The asset possesses significant additional commercial growth opportunities, the company said.
“Acquiring high-quality mineral interests in the northern Delaware Basin and strategic surface acreage in the Midland Basin will immediately contribute to TPL’s free cash flow,” said TPL CEO Tyler Glover. “The combined asset purchase price implies a greater than 13% 2025 free cash flow yield at current strip prices, giving credit to only existing production and line-of-sight wells and opportunities.”
The bolt-on transactions, in addition to the cash flow they currently generate, have excellent growth qualities that fit with TPL’s legacy portfolio, Glover said.
“By owning overlapping and nearby surface and water assets, we believe we can accelerate development and generate incremental value,” he said. “Both assets were sourced through our industry and professional networks and were not part of a broad marketed process. These type of premium assets located within the core subregions of the Permian Basin represent the growth opportunities available to TPL that can provide a substantial incremental value driver to our legacy asset base.”
RELATED
From Failed Post-Civil War Railroad to Permian Basin Royalties Giant
Recommended Reading
Eni Reports Discovery Offshore Mexico in Block 9
2024-07-10 - Italian energy giant Eni SpA announced a discovery at the Yopaat-1 EXP exploration well in the offshore Mexico Block 9 of the Cuenca Salina in the Sureste Basin, which potential up to 400 MMboe in place.
E&P Highlights: July 10, 2024
2024-07-10 - Here’s a roundup of the latest E&P headlines including TotalEnergies exiting South Africa to focus on opportunities in Namibia.
CNOOC’s Bohai Bay Well Achieves High Yield
2024-07-11 - CNOOC’s Bozhong 19-6 Condensate Gas Field D1 well, the first ultra-deep well in China’s Bohai Bay, is currently producing approximately 6,300 boe/d.
Goodbye Manual Control: Vital Energy’s Automation Program Boosts Production
2024-07-12 - Production, ESP efficiency soared when the company automated decisions with AI at the edge.
Southeast Asia NatGas Projects Could Unlock $100B Boom- Rystad
2024-07-17 - Southeast Asia's offshore gas industry is set for a $100 billion boom by 2028, driven by a flurry of final investment decisions by oil and gas majors and national oil companies, according to Rystad Energy.