Halcon Resources has entered into an agreement to acquire 20,748 net acres in the Southern Delaware Basin (the Pecos County Assets) for $705m.

The Houston-based company has also signed an option agreement to purchase an additional 15,040 net acres in Ward County, Texas from a private operator for $11,000/acre.

The Pecos County Assets include acreage in Pecos and Reeves Counties, Texas and are currently producing about 2,600 net barrels of oil equivalent per day (boe/d).

Besides, it has signed an agreement to sell its East Texas Eagle Ford assets (El Halcón) to a subsidiary of Denver-based Hawkwood Energy for $500m.

The sale of the El Halcón assets, which currently are producing about 6,000 net boe/d, is expected to be completed by early March 2017.

The transaction is subject to customary closing adjustments and conditions.

Halcón’s chairman, CEO and president Floyd Wilson said: “These transactions represent a strategic pivot for us into the Delaware Basin. 

“After the consummation of these transactions, we will have core operating areas in two of the most attractive North American oil basins with decades of highly economic development drilling ahead of us.

“The proceeds from the sale and the equity offering provide sufficient funds to acquire the Delaware assets and fund drilling capital to grow our asset base over the next several years, while at the same time improving our leverage profile.”

Halcón plans to finance the acquisitions with the proceeds from the $400m private placement as well as the divestiture of its El Halcón assets.