Transaction Details: 

Closing Announcement - October 7, 2016

Resolute Energy has closed acquisition of certain oil and gas properties located in Reeves County, Texas, for an aggregate purchase price of $135.0 million. The acquisition was financed in part with proceeds received from the previously announced private offering of shares.

Initial Announcement - October 5, 2016

Resolute Energyhas inked an agreement with Firewheel Energy, LLC, a portfolio company of EnCap Investments, to acquire certain oil and gas properties located in Reeves County, Texas, for a purchase price of $135 million. 

Transaction Details

• Reserves : 6.2 MMboe Proved Reserves
• Production : 1200 Boe/d
• Land : 3,293 Net Acres
• Where : Reeves County, TX

 Map

The transaction is expected to close on October 7, 2016.

The Firewheel Properties consist of 3,293 net acres in our highly productive Delaware Basin operating area, and include interests in thirteen horizontal and fifteen vertical wells, which produce approximately 1,200 net Boe per day. Approximately 95% of the acreage and substantially all of the production and proved reserves are located within the Resolute-operated Mustang project area in Reeves County.

The remainder of the acreage is also in Reeves County. The Firewheel Properties contain estimated proved reserves of 6.2 MMBoe with PV-10 of $45.8 million, using strip pricing at June 30, 2016. The acquisition also includes Firewheel's interest in the Earn-Out Agreement with Caprock Permian Processing LLC and Caprock Field Services LLC. Following the closing of the acquisition, Resolute will receive 100% of all payments from Caprock under the Earn-Out Agreement.

The purchase price for the acquisition is $135 million, consisting of $90 million payable in cash and the issuance to Firewheel of 2,114,523 shares of our common stock, equal to $45 million, based on 90% of the volume weighted average price of our common stock as traded on the NYSE for the 15 trading days ending on October 4, 2016. We expect to finance the cash portion of the acquisition price with the net proceeds of a private offering of a newly created class of preferred stock of the Company, and borrowings under our Revolving Credit Facility (which is currently undrawn).

The acreage to be acquired represents an approximately 25% increase in our net acreage in Reeves County while leaving our gross acreage position essentially unchanged as the Company already owns interests in all of the same properties.

BMO Capital Markets and Petrie Partners, LLC acted as financial advisors to Resolute on the Firewheel acquisition transaction.

About Firewheel Energy LLC

FireWheel Energy, LLC is an independent oil and gas development company headquartered in Midland, Texas. The company is pursuing both greenfield development and acquire-and-exploit opportunities and is focused on the Permian Basin and East Texas. Management has diverse operational, engineering, geological and business experience as well as a history of value creation in both of the company’s core focus areas. Previously, the majority of FireWheel’s senior management team held executive level positions with XTO Energy Exxon.

Contact:

FireWheel Energy, LLC
P.O. Box 1105
Houston, Texas 77251

Permian - Delaware Basin Deal Activity In Last 12 Months