WildHorse buys Eagle Ford assets for US$625 million
Wednesday, May 17, 2017
WildHorse Resource Development is acquiring Eagle Ford properties for US$625 million.

The assets, comprising 111,000 net acres (449 square km), are being purchased from Anadarko Petroleum and affiliates of private equity firm Kohlberg Kravis Roberts & Co.

In 2016, fourth-quarter net production on the acquired properties totalled 7,583 boepd, comprising 72% oil from 386 operated wells. The assets are located in Texas’ Burleson, Brazos, Lee, Milam, Robertson and Washington counties, adjacent to WildHorse’s existing acreage position. The transaction is expected to close on or around June 30, 2017 with an effective date of January 1, 2017.

The Houston-based firm said that production on the purchased acreage came from 68 Eagle Ford, 299 Austin Chalk, and 19 Buda-Georgetown operated wells. The acreage is estimated to contain 949 net Eagle Ford locations and 22.9 million boe of proven developed producing reserves, consisting of 73% oil and 88% liquids.

“This transformative acquisition presented us with a strategic opportunity to consolidate our acreage position. With a total of 385,000 net acres [1,558 square km], we have built a premier contiguous acreage base, making us the second largest operator in the entire Eagle Ford trend,” said WildHorse’s chairman and CEO, Jay Graham.

“WRD’s pre-acquisition drilling schedule already includes 36 wells immediately adjacent to the acquired acreage,” he added. “With the new acquisition, WRD can further optimise pad location and development planning with fewer limitations.”

The Eagle Ford play has been seeing a recovery following a steeper decline than that experienced by any other major US shale play as after oil prices collapsed. Proportionately, its oil and gas rig count has risen far more in the last six months than it has in the prolific Permian Basin.

Anadarko, meanwhile, said recently that it was stepping up its efforts outside the Eagle Ford, in the Permian’s Delaware Basin, the Denver-Julesburg (DJ) Basin in Colorado and the deepwater US Gulf of Mexico.

In January, Anadarko announced that it would sell Eagle Ford acreage for US$2.3 billion to Sanchez Energy and private equity firm Blackstone Group. The sale comprised over 318,000 net acres (1,287 square km) in Texas’ Dimmit, Webb, La Salle and Maverick counties, with output of 45,000 bpd of liquids and 131 mmcf (3.7 mcm) per day of gas.

This NewsBase commentary is from our UOGM publication. To sign up for your free trial, click this link: http://newsbase.com/publications/unconventional-oil-gas

Read more NewsBase top stories via this link: http://bit.ly/2h95NUx

Find out more about North American Oil and Gas from NewsBase