Chaparral Energy Inc. spent the latter part of 2017 hurtling toward the Stack play starting line with $170 million dollars in divestitures, a joint venture and added balance sheet protection.

In late December, the largely overlooked private E&P will move in force into in the heart of Oklahoma’s black oil window following an agreement for buy 7,000 net acres in the Stack play. Chaparral described the acreage as the only block of undeveloped Meramec and Osage acreage in central Kingfisher County, Okla.

In deals worth nearly $60 million, the company agreed to buy assets from Blake Production Co. Inc., Fairway Energy LLC, Vernon Resources LLC, ABV Ventures LLC, according to regulatory filings. Chaparral said that the owners lacked the finances to fully develop the acreage.

The acreage will add 28% to Chaparral’s core Kingfisher acreage, bringing its position to 117,000 net acres. The company’s inventory will expand by 170 net horizontal drilling locations in the Meramec and Osage.

No horizontal wells have been drilled in the acquisition area, though offset wells have generated more than 50% rates of return at $50 oil prices, the company said.

In 2017, IP30s from Chaparral and Alta Mesa Holdings LP spud three wells in the area with average lateral lengths of about 4,750 ft, producing a median 800 barrels per day (bbl/d).

Among vertical Mississippian well tests, wells have produced 24-hour IPs of more than 200 bbl/d.

“We are particularly excited about this acquisition due to its location adjacent to our existing operations in the sweet spot of this highly productive play,” Chaparral CEO Earl Reynolds said. “Our understanding of the rock, extensive experience in the area and access to existing infrastructure will allow us to maximize the value of this core area.”

Reynolds, who served at Devon Energy Corp. (NYSE: DVN) for 10 years, including as vice president of strategic planning, said the bolt-on acquisition further enhances the company’s Stack position while a $60 million increase to its borrowing base to $285 million is a testament to the value of its assets.

“Given our exceptional position within the play, as well as our strong balance sheet, Chaparral is well positioned to continue to drive long-term growth and create value for our shareholders,” he said.

At $8,500 per acre, the company sees the acreage as a bargain pick up compared to recently announced and closed deals.

Chaparral shored up its balance sheet last year through transactions and partnerships.

In October, the company sold EOR assets for $170 million with an eye toward funding Stack development. In September, Chaparral entered a DrillCo with a Bayou City Energy subsidiary that will provide up to $100 million for drilling and completion costs for 30 Stack wells.

In December, the company also closed on a new $400 million credit facility, which will fund the acquisition.

Thompson & Knight LLP served as legal counsel to Chaparral for the acquisition.

Darren Barbee can be reached at dbarbee@hartenergy.com.