Ranger operating area sold
By Richard Rostad, analyst, Oil & Gas 360

Callon Petroleum brought activity to a slow U.S. M&A market yesterday, shuffling its Permian portfolio in several deals.

Callon has agreed to divest its non-core Midland Basin properties for $260 million in cash, plus up to $60 million in contingent payments. The company is selling its Ranger operating area, assets that include 80 producing wells over 9,850 net acres. Callon estimates the area has 70 delineated undrilled locations that can produce a 25% IRR at strip pricing. The assets produced 4 MBOEPD in February. This production implies there are few new wells in the area, as the 80 producing wells are yielding an average of 50 BOEPD per well.

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