Family could sell huge Texas oil tracts - sources
Reuters
Published Sep 01, 2022 03:57PM ET
Updated Sep 02, 2022 12:15AM ET
By Shariq Khan and David French
(Reuters) - A Texas family which owns 70,000 acres in the Permian basin is exploring options including a sale, putting up for grabs one of the largest family-owned tracts in the heart of U.S. shale country, people familiar with the matter said.
The land, known as the Mabee Ranch after late farmer-turned-oilman John Mabee who bought into it in 1932, is leased to energy producers including ConocoPhillips (NYSE:COP), Diamondback (NASDAQ:FANG) Energy Inc and Pioneer Natural Resources (NYSE:PXD) Co.
It is owned by relatives of Mabee, who died in 1961, with a stake also held by a charitable foundation he set up with his wife, Lottie.
The sources did not discuss the expected price of the site, but said it was expected to generate around $575 million of free cash flow in 2023 from royalties collected on oil and gas production alone.
The family had decided to cash out and distribute the property's worth to those relatives with stakes, the sources said, cautioning no deal was guaranteed. The sources spoke on condition of anonymity to discuss confidential information. Representatives for the Mabee Ranch did not respond to a comment request.
U.S. crude prices have receded from the 14-year high hit in March following Russia's invasion of Ukraine, but remain elevated.
The family is working with advisers to consider options that include the sale of the surface rights to work the land and mineral rights to extract oil and gas from it, as well as pipeline infrastructure supporting production, the sources said.
The buyer could use the rights or license them to others.
Should a sale happen, much of the value would go to family members, while some would go to the foundation, they added. The foundation's website says it has deployed nearly $1.3 billion since 1948, mainly funding healthcare, education, and religious buildings in six states including Texas, Oklahoma and Missouri.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.