
Hart Energy
Recently, the A&D stars aligned for Houston’s Rockcliff Energy LLC and Tulsa, Okla.-based Samson Resources II LLC.
For the past two years or so, Rockcliff has evaluated acquisition opportunities in the ArkLaTex region, according to its website.
Then, in May, Samson Resources II LLC began marketing 210,000 net acres targeting the Haynesville, Mid-Bossier and Cotton Valley fairways.
The gravitational pull of logic and money had the two on a collision course. On Aug. 1, the companies A&D teams put a deal together. Samson Resources agreed to sell assets in East Texas and North Louisiana for $525 million to an affiliate of Rockcliff.
Rockcliff will acquire Samson’s 210,000 net acre position along with average production of about 90 million cubic feet equivalent per day net to the company’s interest. As of March, the acreage was 95% HBP.
Samson’s board of directors intends to use the proceeds to pay down outstanding debt of between $210 million and $215 million as of Sept. 1. The company has a senior secured revolving credit facility of $280 million. Remaining proceeds will fund Samson’s capital needs in 2018 along with a possible distribution to its equity investors.
Samson Resources holds about 146,000 net acres in the Powder River Basin and 59,000 net acres in the Green River Basin, the company said.
Samson Resources purchased the assets of bankrupt Samson Resources Corp. in March and since then has divested about $14 million of noncore assets and equipment.
The Rockcliff deal came about through a robust marketing process after engaging investment banks Jefferies LLC and Houlihan Lokey Capital Inc., said Joseph A. Mills, Samson Resources’ president and CEO.
“Rockcliff Energy is a top tier oil and gas operator with a long, successful history in the East Texas basin and the purchase price is reflective of the quality of the Samson assets in this area,” Mills said.
Mills previously served as chairman of the board and CEO of Eagle Rock Energy Partners, which was purchased in 2015 by Vanguard Natural Resources LLC for $614 million.
- ArkLaTex sale is expected to close on Sept. 29 with an effective date of Aug. 1.
Rockcliff has significant expertise in the ArkLaTex region to establish itself as a “major player” there, said Alan Smith, Rockcliff Energy’s president and CEO.
“This land position, which is practically impossible to replicate, is strategically positioned in a very favorable natural gas market,” Smith said. “These assets provide a good balance of production and drilling inventory in multiple horizons, and we are excited to apply our deep unconventional experience and capabilities to create value for our investors over the years to come.”
Rockcliff operates in the Delaware Basin and San Andres play. In New Mexico, the company has 60 producing wells, according to New Mexico State Oil Conservation Division records.
Jefferies LLC and Houlihan Lokey Capital Inc. provided Samson financial advice in the sales process. Samson’s legal adviser was Willkie Farr & Gallagher LLP. Rockcliff Energy was represented by Locke Lord LLP.
Darren Barbee can be reached at dbarbee@hartenergy.com.
Recommended Reading
Rising Phoenix Capital Launches $20MM Mineral Fund
2025-02-05 - Rising Phoenix Capital said the La Plata Peak Income Fund focuses on acquiring producing royalty interests that provide consistent cash flow without drilling risk.
Pearl Energy Investments Closes Fund IV with $999.9MM
2025-02-04 - Pearl Energy Investments’ Fund IV met its hard cap within four months of launching and closed on Jan. 31.
Exclusive: Why Family Offices Favor ‘Lower-Risk’ Oil, Gas Investments
2024-11-22 - Evan Smith, Stephens’ senior vice president for investment banking, describes growth in the company’s network of family offices, specifically those investing in the energy sector, in this Hart Energy Exclusive interview.
Magnolia’s Board Adds Ropp as Independent Director
2025-01-07 - Alongside his experience in oil and gas operations, R. Lewis Ropp has a background in finance, capital markets and investment management, Magnolia Oil & Gas said.
E&P Consolidation Ripples Through Energy Finance Providers
2024-11-29 - Panel: The pool of financial companies catering to oil and gas companies has shrunk along with the number of E&Ps.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.