Felix Energy LLC, a closely held Denver-based oil producer with operations in the largest U.S. shale field, is exploring a sale that could value the company at more than $3.5 billion, two people familiar with the matter said Oct. 25.
The U.S. oil producer with assets in the Permian Basin has hired investment bank Jefferies to solicit buyers, the sources said.
Felix Energy did not respond to requests for comment.
Premium prices paid this year for acreage in the Permian Basin of West Texas and New Mexico, the largest and fastest growing oilfield, has smaller companies looking to cash in on their holdings. At the same time, higher crude oil prices have allowed bigger oil producers to acquire new holdings.
Endeavor Energy Resources LP, an oil producer based in Midland, Texas, is also exploring a sale that could value the company at more than $10 billion, according to unnamed sources.
Earlier this year, RSP Permian was bought by Concho Resources Inc. (NYSE: CXO) for $9.5 billion and Energen Corp. (NYSE: EGN) agreed to be acquired by Diamondback Energy Inc.'s (NASDAQ: FANG) in a pending $9.2 billion acquisition. Concho paid more than $70,000 an acre in its deal.
The company's acreage in the Permian Basin is concentrated in the oil-rich Delaware Basin in Loving, Winkler and Ward counties in West Texas. Felix has more than 70,000 net acres in the Permian Basin, one of the people familiar with the matter said.
Qatar Petroleum said March 11 it had struck a deal with Italy's Eni to acquire a 25.5% participating interest in block A5A in the Angoche Basin, offshore Mozambique.
The action comes as Nigeria takes a more aggressive approach to collecting taxes and royalties that the country says it is owed.
The steps are being taken after BP drilled only one of the four wells it was required to drill within six years of the effective date of its exploration licenses for the land, the petroleum board said in a Jan. 15 news release.