Permian Resources, a Texas-based oil and natural gas company, has agreed to acquire certain upstream assets in the Northern Delaware Basin, US from APA for $608m.
The transaction involves approximately 13,320 net leasehold acres and 8,700 net royalty acres situated adjacent to Permian Resources’ existing operations in southeastern New Mexico.
APA CEO John Christmann IV said: “We remain committed to focusing our portfolio on core assets where we are actively investing for the long-term. The New Mexico package represents less than 5% of our Permian oil production and unconventional acreage.”
The acquisition is anticipated to be finalised by the end of Q2 2025, subject to standard post-closing adjustments.
The acquired properties are estimated to produce 12,000 barrels of oil equivalent per day during H2 2025, with an oil cut of approximately 45%.
Around 65% of the acreage is currently operated and has an average 8/8ths net revenue interest of roughly 83%. This configuration is expected to strengthen Permian Resources’ existing royalty base while enhancing capital efficiency.
The bolt-on acquisition will integrate into Permian Resources’ Parkway asset in Eddy County, a region where the company has maintained some of its lowest capital reinvestment rates.
With the new acreage overlapping its current operations, the company anticipates cost-effective development of over 100 gross operated, two-mile horizontal drilling locations. These well locations are forecast to break even at approximately $30 per barrel of West Texas Intermediate (WTI) crude oil.
Permian Resources noted that the acquisition supports long-term accretion by lowering reinvestment requirements. The acquired assets exhibit low production decline rates, allowing the company to maintain output levels while deploying less capital over time.
The shallow decline and high net revenue interest are expected to reinforce Permian Resources’ strategy of focusing on assets that meet strict return thresholds.
In addition to operated wells, Permian Resources will gain non-operated working interests in areas surrounding its New Mexico footprint. The company intends to utilise its existing ground game strategy to trade these interests for expanded stakes in operated units or to consolidate new development areas.
The acquired properties also include interests in over 100 existing Permian-operated wells, further consolidating its position.
Permian Resources Co-CEO James Walter said: “This acquisition is a natural fit for us and has material upside that Permian Resources is uniquely positioned to realize.
“We continue to grow our high return inventory, our net royalty acre portfolio and our acreage footprint in a cost-efficient manner that reflects the current environment.
“Our overarching goal is to drive long-term value for our investors, and we believe the addition of high-quality assets adjacent to our core position, acquired during a lower commodity price environment will further enhance short and long-term returns for investors.”
The deal announcement coincided with Permian Resources’ release of its financial and operational results for Q1 2025. The company reported average crude oil production of 175,000 barrels per day and total production of 373,200 barrels of oil equivalent per day.
Permian Resources completed the previously announced $180m divestment of its non-core Barilla Draw gathering systems during the quarter.
