Pioneer To Acquire Midland Basin Acreage, Add Rigs In 2Q16
Zacks Investment Research | Jun 15, 2016 10:46PM ET
Pioneer Natural Resources Company (NYSE:PXD) has entered into a purchase and sale agreement with Devon Energy Corporation (NYSE:DVN) to acquire about 28,000 net acres in the Midland Basin. The transaction has been valued at $435 million.
The acreage is spread across Martin, Midland, Upton, Reagan, Glasscock, Andrews, Dawson, Gaines and Howard counties. It has a current net production of about 1,000 barrels of oil equivalent per day (BOEPD), of which about 70% is oil. Almost the entire acreage is held by production.
Most of the 28,000 net acres is situated in the core of the Midland Basin. A substantial portion of the acreage to be acquired offsets the existing acreage of Pioneer. Of the core acreage being purchased, about 15,000 net acres are situated in the Sale Ranch area in Martin County and northern Midland County where Pioneer has drilled its most productive Wolfcamp B wells.
Notably, a considerable acreage of the Wolfcamp B that Pioneer is obtaining in the Sale Ranch area lies right below Pioneer’s Wolfcamp A acreage. The acquisition, together with Pioneer’s existing acreage in the area, will add about 70 Wolfcamp B locations to Pioneer’s Sale Ranch area drilling inventory.
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