Post-completion of the deal, Crescent Energy will grow its legacy non-operated stake of around 15% to an operated working interest of around 50% in the acquired assets, which will result in the company having operatorship in nearly 90% of its position in the Eagle Ford basin
Crescent Energy has agreed to acquire operatorship and incremental working interest in its existing Western Eagle Ford assets in the US from Mesquite Energy for $600m in an all-cash deal.
According to Crescent Energy, the deal which involves its existing non-operated assets, will considerably boost its scale in the Eagle Ford. The asset is fully operated with nearly 75,000 contiguous net acres, that are mainly located in Dimmit and Webb counties in Texas.
Post-completion of the deal, Crescent Energy will grow its legacy non-operated stake of around 15% to an operated working interest of around 50% in the acquired assets. The company will also be operating nearly 90% of its position in the Eagle Ford basin.
Through the deal, the company is purchasing over $700m of proved developed producing PV-10 value.
Crescent Energy said that it anticipates the deal to be accretive immediately to key per share metrics, including free cash flow, operating cash flow, and net asset value.
With the acquisition, the company’s expanded operational control is expected to give scope for meaningful enhancement in capital efficiencies, performance of assets, and synergies across the Eagle Ford basin.
It also adds high-value locations which will almost double Crescent Energy’s operated inventory in the basin with significant potential upside from the Austin Chalk and Upper Eagle Ford.
Crescent Energy CEO David Rockecharlie said: “This acquisition cements our position as a leading consolidator in the Eagle Ford and is consistent with the low-risk, acquire and exploit strategy that we’ve employed for the past decade.
“We know these assets well as an active non-operated owner for the last six years and see meaningful upside potential through increased scale and operatorship. As operator, we look forward to engaging with all stakeholders to improve performance and maximise value across this high-quality asset base.”
The deal, which is subject to customary conditions, is anticipated to close early in Q3 2023.
Last year, Crescent Energy signed a $815m deal with Verdun Oil Company II to acquire certain Uinta basin assets in Utah, US from the latter.