Transaction Details: 

Private equity backed Sequitur Energy Resources, LLC announces that it recently acquired producing properties located in Reagan and Upton Counties, Texas from Callon Petroleum.  

Transaction Highlights:

• Purchase price of $264.6 million, before customary adjustments, effective January 1, 2019
• ~11,000 net acres with greater than 200 estimated future development locations based on 880’ well spacing with an average lateral length exceeding 8,300’
• ~Average net production of greater than 5,000 BOEPD (three-stream basis - 44% oil) during January 2019 with an estimated 19 MMBOE of PDP reserves, valued at over 80% of the purchase price at the time of execution of the Purchase and Sale Agreement in April
• Average WI of ~77% and effectively 100% operated by Sequitur
• Acreage is primarily HBP
• Substantial oil, gas and water infrastructure providing significant synergies with Sequitur’s existing facilities
• Future potential annual contingency payments through 2021, capped at $61.1 million, subject to annual WTI averages
• Sequitur’s Permian footprint increases to ~88,000 net acres, ~28,000 of which are in Reagan and Upton Counties and ~60,000 of which are in Irion and Crockett Counties, with net production in excess of 35,000 Boepd (~40% oil/68% total liquids)

 Scott D. Josey, CEO, said, “This transaction is an excellent bolt-on acquisition at attractive metrics, which complements our existing Reagan County position and further expands our footprint into Upton County. It is consistent with our corporate philosophy of focusing on rate of return, cashflow, and operated contiguous acreage positions with substantial upside and modest drilling commitments.”

Permian - Midland Basin Deal Activity In Last 12 Months