Published: September 20, 2024 |

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Matador Resources has closed on it strategic bolt-on acquisition of a subsidiary of Ameredev II from affiliates of EnCap Investments for cash consideration of $1.832 billion.

Joseph Wm. Foran, Matador’s founder, chairman, and CEO released the following statement.

“On behalf of the board and executive committee, I would like to acknowledge the extra effort and professionalism of everyone at Matador, Ameredev, and EnCap to close this important transaction on time and as scheduled.

“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 percent average rate of return.

“The Ameredev acquisition also includes an approximate 19 percent equity interest in the parent company of Piñon. On August 21, 2024, Enterprise Products Partners announced that it was acquiring Piñon for $950 million in enterprise value. Matador expects to receive its proportionate share of such proceeds, in accordance with the applicable payout mechanism, following the closing of the Piñon acquisition, which Enterprise has indicated is expected to occur in the fourth quarter of 2024, subject to customary regulatory approvals.

“Matador successfully integrated the advance assets that we acquired during 2023, and we are confident that we will successfully integrate the Ameredev assets as we go forward in much the same manner. To start, our operations team expects to implement on new wells operational efficiencies such as ‘simul-frac’ and ‘trimul-frac’ completion operations, dual fuel technologies and other operational efficiencies on the Ameredev assets that have worked well on other properties. Matador estimates that these operational efficiencies will result in synergies of approximately $160 million over the next five years.

“We are excited about our positive outlook for the remainder of 2024 and 2025. We look forward to further discussing the Ameredev assets, including our plans for the fourth quarter of 2024, during our third quarter 2024 earnings release and conference call next month. We especially want to express our respect and appreciation for Ameredev’s professionalism and cooperation in the transition process, both with its management team and its field and office staff.”

Matador Resources is an independent energy company engaged in the exploration, development, production, and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays. Its current operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. Matador also operates in the Eagle Ford shale play in South Texas and the Haynesville shale and Cotton Valley plays in Northwest Louisiana. Additionally, Matador conducts midstream operations in support of its exploration, development and production operations and provides natural gas processing, oil transportation services, oil, natural gas and produced water gathering services and produced water disposal services to third parties.

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