Tuesday, October 11, 2022

Rimrock: Sayonara? October 11, 2022

From my perspective, it's a pretty big deal to have Devon in the Bakken, but then again, that's just me. 

In today's NDIC daily activity report:

  • Change of operator: from Rimrock Oil & Gas to WPX Energy, about 250 wells;
    • almost all in Dunn County;
    • a handful in McKenzie County

Background, from Rigzone, June 10, 2022:

Devon Energy Corp has announced that it has entered into a definitive purchase agreement to acquire the leasehold interest and related assets of RimRock Oil and Gas LP in the Williston Basin for a total cash consideration of $865 million.

The deal is subject to customary terms and conditions and is expected to close in the third quarter of 2022, with an effective date of April 1, 2022, Devon noted. It is expected to be immediately accretive to all relevant per-share metrics in the first year, including earnings, cash flow, free cash flow, and net asset value, according to Devon.

Devon outlined that the transaction adds a contiguous position of 38,000 net acres directly offsetting and overlapping Devon’s existing position. The company noted that the deal adds more than 100 “highly economic” undrilled inventory locations, “positioning the company’s Williston Basin assets to maintain high-margin production and strong cash flow for several years”.

RimRock had made no mention of the deal on its website at the time of writing. The company’s latest news release was made in February 2021 and related to the completion of an exchange agreement between RimRock and XTO Energy Inc. Under the terms of that deal, RimRock and XTO exchanged approximately 5,500 net acres and associated production located in Dunn County, North Dakota. 

38,000 acres (?).

$865 million / 38,000 acres = $23,000 / acre. 

Over at the blog's "operators" page:

RimRock Oil & Gas

Devon

A google search with regard to the deal:

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