Diversified Energy to Acquire ConocoPhillips’ Midcon Assets for $240 Million
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Diversified Energy has entered into a purchase and sale agreement (PSA) to acquire certain upstream assets and related facilities in Oklahoma and Texas, from ConocoPhillips.
“I am pleased to announce another strategically-aligned acquisition at a compelling valuation in the company’s Central Region that reinforces our commitment to create long-term value for shareholders. Financed entirely with existing liquidity, this non-dilutive acquisition represents a compelling opportunity to further scale our Central Region portfolio while maintaining a strong balance sheet,” said CEO Rusty Hutson, Jr.
“Building on our success in Appalachia, we are excited to increase our holdings within the Central Region that position us to drive greater synergies and unlock additional shareholder value through scale,” added Hutson.
The company signed a PSA with ConocoPhillips on July 27, 2022 for a purchase price of $240 million. The company expects to close the transaction in late September 2022, following customary due diligence. Closing is subject to customary conditions being met, including title an environmental review.
EXPANDING PRESENCE AND SCALE IN THE CENTRAL REGION
The acquisition, which includes an interest in ~1,500 producing wells located in Oklahoma and Texas represents Diversified’s sixth major acquisition within the Central Region since May of 2021 and the second acquisition in the Mid-Continent area since mid-2021. The proximity of the assets to previously acquired Tapstone assets creates further potential to develop operational synergies of scale in the Central Region and benefits from a constructive regulatory environment.
The company will operate ~60 percent of the Acquisition’s net production of ~9 MBoepd (52 MMcfepd; ~90 percent natural gas and NGLs), which represents a 6 percent increase to Diversified’s 1Q22 exit rate (136 MBoepd; 816 MMcfepd).
Consistent with the company’s asset acquisition strategy, Diversified intends to retain certain ConocoPhillips experienced personnel who will complement Diversified’s asset stewardship operating philosophy designed to improve well performance, enhance margins, and lower emissions.
The company has posted an acquisition presentation on their website.
About Diversified Energy Company
Diversified Energy Company is an independent energy company engaged in the production, marketing, and transportation of primarily natural gas related to its synergistic U.S. onshore upstream and midstream assets.
To stop by Diversified Energy’s website, CLICK HERE
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