WPX Energy Inc. on Dec. 16 agreed to acquire private-equity-backed Felix Energy II with a position in the Permian’s Delaware Basin in a cash and stock transaction valued at $2.5 billion.

The Tulsa, Okla.-based company said the announcement, which confirms reports made late last week of the transaction, is consistent with WPX’s five-year vision for shareholders introduced in November as the acquisition is expected to significantly boost free cash flow in 2020 at $50 oil, allowing the company to implement a dividend.

“Meeting the five-year targets we communicated is the absolute standard and benchmark for any investment we make,” said WPX Chairman and CEO Rick Muncrief in a statement. “Now we can accomplish these objectives for shareholders more quickly and efficiently with the irrefutable benefits of the Felix transaction.”

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