Matador Resources has closed its previously announced $1.83bn acquisition of oil and natural gas producing assets, along with undeveloped acreage, located in the Delaware Basin, US.
As part of the transaction, Matador Resources, listed on the New York Stock Exchange (NYSE), acquired a subsidiary of Ameredev II Parent from affiliates of EnCap Investments.
The all-cash deal was announced in September 2024.
The newly acquired assets are situated in Lea County, New Mexico, as well as Loving and Winkler Counties, Texas.
Additionally, the deal includes a 19% stake in Piñon Midstream, which operates midstream assets in southern Lea County, New Mexico. This stake is expected to enhance coordination between Matador Resources and Piñon Midstream in the gathering, transportation, and treatment of natural gas from the properties previously held by Ameredev.
With the completion of this acquisition, Matador Resources has expanded its holdings by approximately 33,500 contiguous net acres within the core of the Delaware Basin. Of this acreage, 82% is held by production, and over 99% is operated by the subsidiary of Ameredev II Parent.
Production from the newly acquired assets is projected to average between 25,500 and 26,500 barrels of oil and natural gas equivalent (BOE) per day for the remainder of Q3 2024.
A decline in production is expected in Q4 2024 due to natural production declines and the temporary shutting-in of wells for offset completion operations. Production is anticipated to increase again in the first half of 2025.
The acquired assets also include 431 gross (371 net) operated locations, with targets across the Wolfcamp and Bone Spring formations. Additionally, the transaction adds approximately 118 million BOE of proved oil and natural gas reserves, of which 60% is oil.
The enlarged Matador Resources, following the acquisition, is expected to hold 578 million BOE (mBOE), representing a 26% increase from its total proved reserves of 460 mBOE as of 31 December 2023.
Matador Resources operates in the Eagle Ford shale play in South Texas, as well as the Haynesville shale and Cotton Valley plays in Northwest Louisiana.
Matador Resources founder, chairman, and CEO Joseph Foran said: “The Ameredev assets include one of the largest, contiguous blocks of available acreage in the core of the Delaware basin—directly between two of our better asset areas—and we are excited to have the opportunity to integrate the Ameredev properties into our existing assets. The Ameredev gathering assets include 135 miles of water, natural gas and oil pipelines.
“Following the addition of the Ameredev Acquisition, Matador will have collectively over 190,000 net acres in the core of the Delaware Basin, production exceeding 180,000 BOE per day and proved oil and natural gas reserves of over 600 million BOE.
“In addition, we will have approximately 2,000 net locations, which provides inventory of 10 to 15 years with wells exceeding a 50% average rate of return.”
