SM Energy is exploring a sale of certain South Texas assets after closing its Civitas Resources acquisition, with the process reportedly focused on Austin Chalk and Eagle Ford positions. Sources indicate a potential sale could emphasize proved developed producing (PDP) barrels, while SM may retain parts of its undeveloped drilling inventory.
The footprint is meaningful. SM holds ~155,000 net acres in South Texas and produced 86,400 boe/d in Q3 2025, including 203 MMcf/d of natural gas. Operationally, SM’s South Texas program has leaned toward the Austin Chalk, with the company drilling 8 of 21 Austin Chalk wells year to date in Q3, while drilling only three Eagle Ford wells last year.
The broader backdrop is inventory scarcity and elevated deal interest outside the Permian. SM has publicly outlined a plan to reduce debt by $1B following the Civitas transaction, which closed in January and valued Civitas at ~$7.7B including $5B of debt. In parallel, buyers have been active in the Eagle Ford, and other packages, including Exxon’s marketed position, have helped keep South Texas deal momentum in focus.
Why it matters
● Debt reduction can drive portfolio pruning: post-Civitas, divestitures become a direct lever toward SM’s $1B debt reduction target.
● PDP focus changes the buyer set: PDP-heavy packages can appeal to cash-flow buyers, while SM keeps optionality on undeveloped inventory.
● Austin Chalk is the operational center of gravity: activity has skewed to Austin Chalk, which shapes what “core” means inside the marketed area.
● Connectivity is part of marketability: gathering adjacency influences operating efficiency, tie-ins, and integration complexity for scattered packages.
What the map shows
A South Texas view built to clarify what is being discussed: SM’s footprint and activity, plus gathering context around the area.
● SM acreage position in the Eagle Ford and Austin Chalk fairway
● SM active wells to indicate where current activity clusters
● Operational gathering natural gas pipelines in the area (Enterprise, ETC Texas, Navarro Midstream, Williams), shown for connectivity context
● Play outline to keep the interpretation anchored to Eagle Ford and Austin Chalk
A deeper dive with DataLink
Using Rextag Energy DataLink, users can:
● Validate how SM’s acreage and active wells cluster across South Texas
● See how the footprint sits relative to operational gathering corridors
● Isolate sub-areas to evaluate PDP vs undeveloped posture by geography
● Add infrastructure context (processing, transmission, markets) for internal deal screening and integration planning
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