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NOG Grows Its Acreage Position in Delaware

According to the company’s press release on December 19, Northern Oil and Gas Inc. (NOG) closed its announced deal with a private seller of non-operated interests in the Northern Delaware Basin for $131.6 million in cash.

The acquisition was announced with a $13 million deposit in October and is the third Permian Basin acquisition since August, adding to NOG’s $400 million of Permian Basin acquisitions in 2022.

The assets of 2,100 net acres are primarily operated by a private company Mewbourne Oil Co., with production anticipated to total almost 2,500 boe/d in 2023. Also, Coterra Energy Inc. and Permian Resource Corp. are operators of the assets. The assets contain high-quality, low breakeven development that is leveraged to some of NOG’s top operating partners, as our investors have come to expect.

With an effective date of November 1, 2022, the purchase is expected to add roughly $55 million of unhedged cash flow in 2023 as of October 10.

NOG, based in Minnetonka, Minn., targets to be the go-to resource for operators that want to offload non-operated working interests in leasehold. Initially, concentrated in the Williston Basin, the company has also extended into the Marcellus Shale and Permian Basin through a series of purchases.

NOG has incredibly expanded its position in the Permian Basin in 2022. The company’s dealmaking this year soared in January with the closing of a $406.5 million acquisition of Veritas Energy’s non-op position in the Permian, which marked the company’s largest investment to date.

Since then, NOG has increased almost $400 million worth of additional acquisitions in the Permian. Transactions have included a bolt-on acquisition of core northern Delaware Basin properties announced in late September for an initial purchase price of $157.5 million and the closing of a $110 million deal for Midland Basin properties from Laredo Petroleum Inc. on October 6.

One more northern Delaware Basin bolt-on acquisition unveiled by NOG on October 11 includes core non-operated working interest properties in New Mexico’s Lea and Eddy counties and Loving and Winkler counties in West Texas. The purchased assets cover approximately 2,100 net acres, 5.3 net producing wells, 2.1 net wells-in-process, and about 17.2 net undeveloped locations.

Production of almost 2,500 boe/d (68% oil, 2-stream) is anticipated from the acquired assets for 2023, making an estimated $55 million of unhedged cash flow in 2023 at strip pricing as of October 10 and resulting in a 2.4x transaction multiple.

Wells Fargo Securities is the financial adviser to NOG for the acquisition. Kirkland & Ellis LLP is serving as the company’s legal adviser. TPH & Co., the energy business of Perella Weinberg Partners, served as a financial adviser to the seller, and Bracewell LLP is serving as the seller’s legal adviser.

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Tel. +1 713-203-3128 Email: treitmeier@hartenergy.com

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Tokyo Gas Is Set to Buy Rockcliff Energy: One of the Top Haynesville's Producers

On January 3, U.S. natural gas producer Rockcliff Energy from private equity firm Quantum Energy Partners was set to be sold to a unit of Tokyo Gas Co. Ltd. for roughly $4.6 billion, including debt. The all-cash agreement with Houston-based TG Natural Resources, which is 70% possessed by the Japanese energy firm, is decided to be claimed this month, according to anonymous resources, as the discussions were requested to be confidential. Castleton Commodities International (CCI) owns the rest of TG Natural Resources.

On December 9, Crescent Point Energy Corp. announced a purchase and sale agreement to develop its core Kaybob Duvernay assets, which will bolt on production, the midstream infrastructure and technical data. With the deal, the company has committed more than US $1 billion to the play. Crescent Point, the Alberta-based company, is purchasing almost 65,000 net acres from Paramount Resources Ltd. for CA $375 (US $274 million) cash. The assets estimate more than 4,000 boe/d, 50% liquids, and include a gas plant, associated pipelines, water infrastructure, and seismic data. The acquired asset’s production consists of 35% condensate, 15% NGL, and 50% shale gas.

Permian Resources bolsters dominance in the Delaware Basin with strategic land acquisitions, expanding its portfolio by over 5,000 net leasehold acres and 3,000 royalty acres. In a stunning display of growth and strategic maneuvering, Permian Resources Corp., based in Midland, Texas, has made waves in the first quarter by securing a series of deals worth over $200 million in the highly sought-after Delaware Basin. This move solidifies their position as a player in the region.

The Williston Basin, which spans parts of North Dakota, Montana, Saskatchewan, and Manitoba, is a major oil-producing region in North America. In order to transport crude oil and natural gas from the wells to refineries and other destinations, a vast pipeline infrastructure has been built in the area. The pipeline infrastructure in the Williston Basin consists of a network of pipelines that connect production sites to processing facilities, storage tanks, and major pipeline hubs

Matador Resources Co. is making a big move in the oil and gas industry by acquiring Advance Energy Partners Holdings LLC, a major player in the northern Delaware Basin. The acquisition, which comes with a hefty price tag of at least $1.6 billion in cash, includes valuable assets in Lea County, N.M., and Ward County, Texas, as well as key midstream infrastructure.

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