One Way or Another - E&Ps Are Taking Different Approaches to Getting Bigger

The M&A boom in the Permian and Eagle Ford continues unabated. Lately, a multitude of E&Ps have built scale and increased profitability by acquiring other producers that control acreage and produce crude oil, natural gas and NGLs themselves. But it’s also possible for an E&P to boost its holdings by acquiring incremental working interests in its operated assets or by having an affiliate acquire royalty and mineral interests in acreage the producer plans to develop. In today’s RBN blog, we discuss the most recent M&A activity in two of the U.S.’s leading production areas, including Viper Energy Partners’ planned $1 billion purchase of mineral and royalty interests in the Permian; Crescent Energy’s plan to acquire incremental working interests in South Texas; and an old-school, bolt-on acquisition by Magnolia Oil & Gas, also in the Eagle Ford.

It’s been hard to keep up with all the upstream M&A in South Texas, West Texas and southeastern New Mexico — it’s not just the summertime temperatures that have been scorching hot in this part of the world. Just a couple of weeks ago, in Eat or Be Eaten, we examined the plans by Permian Resources to acquire Earthstone Energy; Civitas Resources to buy assets in the Permian’s Delaware and Midland basins from Tap Rock Resources and Hibernia Resources, respectively; and SilverBow Resources to scoop up Chesapeake Energy’s last remaining assets in the Eagle Ford.

A couple of months before that, in What I Like About Texas, we looked at an earlier round of Permian and Eagle Ford M&A, that time involving Vital Energy’s and Northern Oil & Gas’s purchase of Forge Energy II Delaware LLC’s assets in West Texas; Callon Petroleum’s acquisition of Permian-focused Percussion Petroleum Operating II LLC and sale of its remaining assets in the Eagle Ford to Ridgemar Energy Operating LLC; and Crescent Energy’s purchase of Mesquite Energy assets in the Eagle Ford. (More on Crescent in a moment — as we said in the introduction, it’s still in acquisition mode.) And we’ve discussed other Permian-related M&A in Harder, Better, Faster, Stronger and other Eagle Ford dealmaking in Part 1 and Part 2 of our Come Back Story blog series.