From Houston Business Journal:
The Permian Basin continues to churn out deals.
Houston-based Halcón Resources Corp. (NYSE: HK) bought 20,748 net acres in a section of the Permian, the southern Delaware Basin, from Oklahoma-based Samson Exploration LLC for $705 million, according to a filing with the U.S. Securities and Exchange Commission. Those assets are in Pecos and Reeves counties, Texas.
Hálcon also has an option agreement to purchase an additional 15,040 net acres in Ward County, Texas, for $11,000 per acre from a private operator, according to a Jan. 24 press release.
The company, which just emerged from bankruptcy in September, is also selling its East Texas Eagle Ford assets, which currently are producing approximately 6,000 net barrels of oil equivalent a day. A subsidiary of Denver-based Hawkwood Energy LLC will buy those assets for $500 million, and that deal is expected to close in early March, according to the SEC filing.
The company plans to fund its recent acquisitions with its Eagle Ford sale and with $400 million in private equity, per the release. The purchases also are expected to close in early March.
Bank of America Merrill Lynch acted as exclusive financial adviser to Halcón, and Jefferies LLC served as financial adviser to the seller in the Pecos County assets deal, according to the release. BofA Merrill Lynch and J.P. Morgan Securities acted as placement agents in the private placement of preferred stock.
“After the consummation of these transactions, we will have core operating areas in two of the most attractive North American oil basins with decades of highly economic development drilling ahead of us,” Floyd Wilson, Halcón’s chairman, CEO and president, said in the release. “The proceeds from the sale and the equity offering provide sufficient funds to acquire the Delaware assets and fund drilling capital to grow our asset base over the next several years, while at the same time improving our leverage profile.”
Wilson is the former CEO of Petrohawk Energy, which was sold to BHP Billiton for $12.1 billion in 2011. Petrohawk is credited with drilling the first well in the Eagle Ford Shale.
Companies have been increasingly turning to the Permian Basin in recent months, with new rigs being added almost every week and several asset deals reaching nine or 10 figures. Here’s a rundown on the latest from the Permian:
- Houston-based Plains All American Pipeline LP (NYSE: PAA) announced Jan. 24 it’s further bulking up its Permian Basin assets with a $1.215 billion acquisition. Midland, Texas-based Concho Resources Inc. (NYSE: CXO) and Oklahoma-based Frontier Midstream Solutions LLC are selling 100 percent of Alpha Holding Company LLC, the owner of the Alpha Crude Connector system, to Plains in two separate deals.
- Also on Jan. 24, BridgeTex Pipeline Company LLC, of which Plains and Oklahoma-based Magellan Midstream Partners LP (NYSE: MMP) each own 50 percent, announced it would expand its pipeline capacity from the current 300,000 barrels per day to about 400,000 barrels per day. This past week, Plains announced it would expand the capacity of its Cactus Pipeline to 390,000 barrels per day. Both pipelines transport crude from the Permian Basin to the Texas Gulf Coast.
- Earlier this month, Houston-based Noble Energy Inc. (NYSE: NBL) announced it will acquire Midland, Texas-based Clayton Williams Energy Inc. (NYSE: CWEI) in a $2.7 billion cash-and-stock deal that will significantly increase its Permian Basin footprint.
- Also this month, Houston-based Targa Resources Corp. (NYSE: TRGP) announced a deal to purchase Denver-based Outrigger Energy’s assets for up to $1.5 billion.
