FourPoint Energy, EnerVest Form JV To Develop Anadarko Basin Acreage

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Close Date
Estimated Price
268MM
Description

Formed JV in Western Anadarko Basin to develop 90,000 net acres; Acquired producing and undeveloped oil and gas properties.

FourPoint Energy LLC and EnerVest Ltd. have agreed to develop oil and gas properties together in the Western Anadarko Basin.

Denver’s FourPoint announced Jan. 30 the acquisition of producing and undeveloped oil and gas properties and related midstream assets in the Western Anadarko Basin from affiliates of EnerVest for $268 million. The companies also entered into a joint development agreement and area of mutual interest agreement (AMI) to own, operate and develop oil and gas properties in the basin.

The companies will share all future lease and producing property acquisitions within the joint development area, encompassing 14 counties in Texas and Oklahoma and will work together as partners to advance an aggressive acquisition and development plan.

FourPoint's purchase includes an ownership stake in the Laredo Petroleum Inc. (NYSE: LPI) and SM Energy Co. (NYSE: SM) acquisitions closed by EnerVest in the second half of 2013. The acquisition includes interest in more than 1,200 producing wells with net production of more than 35 million cubic feet equivalent per day (MMcfed).

Each company will hold a 50% interest in the AMI with Houston’s EnerVest designated as operator. The companies hold an acreage position of more than 90,000 net acres in the multi-pay region.

FourPoint Energy is a privately held E&P company founded by the leadership team of Cordillera Energy Partners following its sale to Apache Corp. (NYSE: APA) in 2012. The venture with EnerVest will be the management team's first entry back into the Western Anadarko Basin since the sale.

The enterprise is led by George Solich, FourPoint president and CEO, and the core leadership team from Cordillera who possess the same performance driven, opportunistic, goal-oriented culture building on the experience of three successful companies in 12 years.

"This is a strategic partnership that marries the strengths of both companies and the FourPoint team couldn't be more excited to be working with such a quality team of professionals at EnerVest," Solich said.

As part of the transactions, FourPoint Energy raised more than $1 billion of committed capital including $200 million in direct private equity and $800 million in term debt from EIG Global Energy Partners LLC and funds advised by GSO Capital Partners LP. Additionally, FourPoint Energy entered into a $250 million credit facility with JPMorgan Chase Bank NA and Wells Fargo Bank NA.

Jefferies LLC is sole financial advisor. JPMorgan Securities LLC is sole lead arranger and book runner on the credit facility. Andrews Kurth LLP is legal advisor to FourPoint Energy in connection with this transaction.