US based Legacy Reserves has entered into an agreement to purchase Permian Basin oil and natural gas properties in Texas for $105m in cash from Concho Resources.

The properties currently produce 1,419 barrels of oil equivalent per day, of which 47% is oil.

Proved reserves are estimated to be 5.8mmboe, 88% of which are considered proved developed producing (PDP).

The closing of the transaction is anticipated to occur on or about 22 December 2010, and is subject to customary purchase price adjustments.

Legacy chairman and CEO Cary Brown said that Permian Basin properties fit the company’s MLP model of acquiring high percentage PDP properties with low production decline rates in areas with established production histories.

"As Legacy has done in the past, it is acquiring assets that are non-core to a resource and drilling-focused E&P company," Brown said.

Headquartered in Midland, Texas, Legacy is engaged in the acquisition and development of oil and natural gas properties.