Ring Energy Inc. (REI) said June 23 it closed its acquisition of Delaware Basin acreage from Finley Resources Inc. for $75 million.
The property is located in Culberson and Reeves counties, Texas, and consists of 14,645 gross (14,322 net) acres. The current net production to the company from this acquisition is about 1,300 barrels of oil equivalent per day. Ring will be the operator and have a 98% working interest and net revenue interest of 79%.
The acquisition will nearly double Ring's daily production and should drive nice additional revenues and cash flow, said Jason Wangler, analyst, Wunderlich Securities Inc., in a report.
Following the acquisition, Ring will have more than 2,750 boe/d of current net daily production from its Permian Basin assets and more than 45,000 gross (32,000 net) acres in the region. The company currently has acreage in the Permian’s Central Basin Platform primarily in Gaines and Andrews counties.
The acquisition was financed with proceeds from the Midland, Texas-based company’s recently completed public common stock offering and its new senior credit facility.
SunTrust Robinson Humphrey Inc. was exclusive financial adviser on the acquisition. The effective date of the acquisition is May 1.
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