Alta Mesa is into exploration and production and has assets in the STACK play in the Anadarko Basin in Oklahoma. On the other hand, Kingfisher is into the gathering, processing, and marketing of hydrocarbons in the STACK play.

Alta Mesa is considered as one of the major and active operators in STACK, with nearly 120,000 contiguous net acres and 4,200 gross identified drilling locations.

According to Silver Run II chairman and CEO James T. Hackett, the Alta Mesa and Kingfisher combination makes a perfect strategic match for the company’s desired integrated platform. 

Hackett added: “Alta Mesa's highly contiguous core acreage position in Northeast Kingfisher County has among the lowest breakevens in the U.S. at around $25 per barrel. Kingfisher adds a highly strategic and synergistic midstream subsidiary with significant additional third party growth potential.”

Upon closing of the merger which is subject to certain conditions, Silver Run II will be renamed as Alta Mesa Resources (AMR).

The management of Riverstone and Alta Mesa put together will own a significant stake in AMR, representing nearly 34% of the pro-forma market capitalization.

Alta Mesa CEO Harlan H. Chappelle said: "We see this as a tremendous way to continue our evolution as a low-cost, high-value producer in the STACK. 

“We have been fortunate to have strong financial partners in HPS Investment Partners and Bayou City Energy during a pivotal stage of growth, and we are well-positioned for this next stage.”

Expected to be completed in the fourth quarter of  2017, the merger would need the approval of the shareholders of Silver Run II along with satisfaction of various closing conditions.

The financial terms of the two definitive agreements signed by Silver Run II have not been disclosed.

Silver Run II is an energy-focused special purpose acquisition company formed by Riverstone Holdings. In March, it raised $1.03bn in an initial public offering. 

Image: Alta Mesa is considered as one of the major and active operators in STACK. Photo courtesy of Vlado/Freedigitalphotos.net.