WPX expands Delaware basin position with new acquisition

TULSA, Oklahoma -- WPX Energy has agreed to acquire assets that would increase its Permian operations to more than 120,000 net acres and deepen its drilling inventory of top-tier Delaware locations while enhancing key financial metrics and margin expansion.

The acquisition includes approximately 6,500 boed (55% oil) of existing production from 23 producing wells (17 horizontals), two drilled but uncompleted horizontal laterals, 18,100 net acres in Reeves, Loving, Ward and Winkler counties in Texas and 920 gross undeveloped locations in the geologic sweet spot of the Delaware basin.

WPX expects the acquisition to be immediately accretive and accelerate its deleveraging progress without increasing its projected 2017 capital outspend. WPX expects the incremental cash flow from the purchase to fund the existing two-rig program on the acquired acreage. This will bring WPX’s rig count in the Permian to seven.

The sellers are Panther Energy Company II, LLC and Carrier Energy Partners, LLC. WPX plans to close the $775-million cash transaction in approximately 60 days using a combination of proceeds from an equity issuance and cash on hand.

Including the Panther transaction, WPX has added approximately 32,000 net acres in the core of the Delaware basin at an average cost of $18,600 per acre since its purchase of RKI Exploration and Production in August 2015. The average cost excludes flowing production.

“In just 18 months, WPX has firmly established itself as a leader in the Delaware basin,” said Rick Muncrief, WPX chairman, president and CEO. “The acquisition leverages our experience to create long-term shareholder value, further builds our inventory of core acreage and accelerates our oil growth with cash on hand and operating cash flow without adding incremental debt.”