Silver Run Acquisition II, a private equity backed oil and gas startup led by the former chief executive of Anadarko Petroleum Corp, has agreed to acquire two Oklahoma energy companies.
The two companies are Alta Mesa Holdings LP, an independent exploration and production company, and Kingfisher Midstream LLC, a private midstream company whose anchor producer is Alta Mesa. Both companies are focused on the STACK play in Oklahoma.
Hackett, currently chairman and CEO of Silver Run II, will be executive chairman of the combined company. Alta Mesa executives Harlan Chappelle, Michael Ellis and Michael McCabe will continue as CEO, COO and CFO, respectively, of the combined company.
A spokesman for Alta Mesa was unavailable for comment on terms of the agreement. Silver Run said it expected the market value of the combined companies to be about $3.8 billion based on its projections of future earnings.
Alta Mesa’s core acreage position in Northeast Kingfisher County has breakevens around $25 per barrel, which Hackett called one of the lowest in the U.S. The 30-year-old company is one of the most active operators in the STACK, per the press release. It has approximately 120,000 contiguous net acres and about 4,200 gross identified drilling locations and has completed 173 of its 205 drilled wells, with 167 on production.
Well economics in Oklahoma’s Scoop and Stack plays rate second only to the Permian Basin of West Texas and New Mexico, according to analyst Housley Carr with RBN Energy. Like the Permian, the Stack and nearby Scoop shale plays are also constrained by a lack of infrastructure to deliver oil to the market.
Combining Alta Mesa with Kingfisher creates a kind of vertically integrated independent shale producer that will get first bite at the apple for space on pipelines.
Compiled and Published by GIB KNIGHT
Gib Knight is a private oil and gas investor and consultant, providing clients advanced analytics and building innovative visual business intelligence solutions to visualize the results, across a broad spectrum of regulatory filings and production data in Oklahoma and Texas. He is the founder of OklahomaMinerals.com, an online resource designed for mineral owners in Oklahoma.