FORT WORTH, Texas—Joe Foran built Matador from friends-and-family financing into an $8 billion public company. But despite a red-hot M&A market sweeping across the Permian, Foran is focused on growing—not selling.

“We feel we’ve made it pretty clear that we still have a lot of growth ahead of us,” Foran, Matador’s chairman and CEO, said during Hart Energy’s SUPER DUG Conference & Expo in Fort Worth.

Matador Resources Co. holds more than 152,000 net acres across the core of the Delaware Basin, spanning from West Texas into southeastern New Mexico.

Matador Acreage
Matador holds about 152,200 net acres in the Permian’s Delaware Basin. (Source: Matador investor presentation)

It’s a part of the Permian Basin that’s seen a significant amount of consolidation in the past year:

Dealmaking is happening all around Matador’s acreage. And with a market value of approximately $7.7 billion, the Dallas-based producer might be one of the more digestible M&A targets for a larger player seeking inorganic Permian growth.

It’s a major growth story for the Matador brand: Foran, 71, originally launched in 1983 as the Foran Oil Co. with $270,000 in financing raised from a small group of his friends and neighbors.

Foran Oil was later contributed into Matador Petroleum Corp., and the first iteration of the company sold in 2003 with an enterprise value of $388 million. The all-cash sale closed on a Friday; Foran founded the second Matador, Matador Resources Co., the following Monday.

Matador is still focused on growth, Foran reiterated, both through small deals and large-scale consolidation.

However, Matador has largely built up its position through brick-by-brick acquisitions. It’s a strategy that served the company well over the years, he said.

Matador’s deals are generally smaller and less risky than large-scale acquisitions. The ground game deals are also typically closer properties adjacent to the acreage Matador already holds.

The company spent about $281 million for Delaware bolt-on acquisitions during the first quarter, adding drilling locations in Lea and Eddy counties, New Mexico, and Ward County, Texas.

But the company also isn’t ruling out large-scale M&A. Matador is coming off its largest acquisition ever, a $1.6 billion takeout of EnCap-backed Advance Energy Partners closed in early 2023.

Matador Advance Rextag.jpg
Matador acquired EnCap-backed private Advance Energy Partners in early 2023, adding scale in the New Mexico Delaware Basin. NOTE: Wells displayed began first production on or after Jan. 1, 2022, per available Rextag data. (Source: Rextag data)

The Advance deal added 18,500 net acres and more than 100 MMboe of oil and gas reserves to Matador’s Delaware portfolio.


Matador Hoards Dry Powder for Potential M&A, Adds Delaware Acreage

Portfolio rationalization

Analysts anticipate that Matador will add value through M&A—either large-scale consolidation or incremental blocking-and-tackling dealmaking.

The company exited the first quarter with a $1.5 billion in liquidity and a net debt-to-EBITDA ratio of 0.75x.

But after a record run of Permian M&A, there are significantly fewer potential targets left in the basin to find and acquire. Some analysts expect to see an uptick in mergers of equals among public peers with fewer private producers left standing.

Matador and other operators also expect to see a rationalization of portfolios by Permian E&Ps that have inked large-scale deals in the past year.

“That’s what I’ve seen over the years,” Foran said. “When you have a period of consolidation, it’s followed by a period of rationalization—which may create more opportunities.”

“Matador isn’t necessarily looking for a big deal as much as it is for something that fits,” he said.

The Permian divestiture market is moving slowly but surely showing signs of life. Occidental Petroleum has already announced plans to reduce debt in connection with a $12 billion pending acquisition of CrownRock LP. Occidental wants to divest up to $6 billion in non-core assets.

Occidental is reportedly exploring a sale of assets and acreage in the southern Delaware Basin, in the Barilla Draw region in Reeves County, Texas.

Other large acquirers, such Exxon Mobil and Diamondback Energy, may also sell off noncore assets that don’t fit within their portfolios.


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A handful of private producers stand out in Matador’s neighborhood in the northern Delaware Basin.

Family-owned producer Mewbourne Oil boasts one of the deepest and most attractive inventory portfolios in the northern Delaware, according to analysts at Enverus Intelligence Research and Rystad Energy.

Franklin Mountain Energy has built up a core Delaware position in Lea County, New Mexico. The E&P was launched in 2018 backed by the founders of Western Refining; Western sold to Tesoro Corp. for $6.4 billion in 2017. Tesoro, after rebranding to Andeavor, sold to Marathon Petroleum for $23 billion in 2018.

Ameredev II LLC, backed by EnCap Investments LP, has also grown a sizable footprint in the Delaware Basin. EnCap has reportedly explored a sale of Ameredev II.

Delaware Basin Privates Rextag.jpg
Mewbourne Oil, Ameredev II and Franklin Mountain Energy stand out among the private producers remaining in the northern Delaware Basin, analysts say. (Source: Rextag data)


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