Denver-based Civitas Resources said Tuesday it is acquiring oil-producing assets in Delaware and Midland basins in west Texas in two separate agreements totaling about $4.7 billion from portfolio companies of NGP Energy Capital Management. The deals mark Civitas’ entry into the Permian Basin. “These transactions make Civitas a better company,” CEO Chris Doyle said, “and we see tremendous opportunity to add value in the Permian that will complement our leading oil position in the DJ Basin… We will soon have nearly a decade of price-resilient, high-return drilling inventory. Our strong capital structure allowed us to capture these transformational assets.”
Civitas said it will purchase about 30,000 net acres in Eddy and Lea counties in New Mexico from Tap Rock Resources for $2.45 billion ($1.5 billion cash). Production in 2023Q1 was 59,000 boed (52 percent oil). The inventory includes about 350 high-quality locations in Delaware Basin. Tap Rock will retain its Olympus development area.
Civitas also agreed to purchase Midland Basin assets from Hibernia Energy III for $2.5 billion cash. The assets include about 38,000 net acres in Reagan and Upton counties. Production in 2023Q1 was about 41,000 boed (56 percent oil). The inventory includes about 450 high-quality locations.
Doyle said the company expects to operate 1-to-2 rigs in each of the two basins.