Chase Gibson, managing partner at Contender Energy Partners, knows what it takes to accomplish goals. He discusses the mineral and royalty acquisition firm’s most challenging deal to date. “It was a mineral opportunity spread across approximately 8,000 acres and four counties. It was about a $6-million or $7-million deal, and during title due diligence we discovered an existing lawsuit was clouding title. At that point it was clear there was not marketable title, and the deal stalled.
“Rather than walk away, we [provided] a short-term solution that met the sellers’ immediate cash needs while simultaneously protecting the capital investment. This solution required the seller to provide additional mineral properties, previously excluded from the package, for collateral to protect the initial acquisition price put up by Contender. This bought us time to walk everything through the litigation process and clearing title. All in all, it took about eight months from start to finish to close the deal.”
Contender has assets under management in Texas and Colorado. Since January of 2017, the company has had roughly $100 million in mineral transactions across approximately 250,000 gross acres. It currently owns mineral interests in more than 125 producing horizontals in the Permian Basin.
Tried and true: Gibson, at 29 years old, helped co-found Contender without third-party capital. “We didn’t have the liquidity to buy 10 mineral acres when we started. However, we were able to complete more than 60 transactions in the first year totaling about $30 million and over 120 transactions to date.”
Even more impressive, Gibson founded an operating company at just 25 years old. This company drilled wells in Oklahoma and Texas, he says, including drilling multiple wells with its own rig, which was acquired and operated as a way to reduce the overall drilling cost. “We also ran our own workover rig and contracted to drill for a few other operators prior to selling.”
Gibson reflects that he “didn’t go down the traditional road of career development, and therefore had no preconceived expectations of when and at what point in one’s career things can be accomplished. I’ve never fallen into the trap of accepting when this industry, or society generally, says it’s acceptable to accomplish certain things or become successful.”
Advice for young professionals: “Experience is no substitute for integrity or character,” he says, adding, “Fail fast, and truly learn from those failures. If you cannot do this, then do not go down the entrepreneurship path.”
Goals: In the short term, Gibson aims to close out the current fund and launch another—this one with a possible multi-basin focus. “We will continue to be opportunistic and see potential in several other basins,” he says. In the long term, he aims to “continue scaling Contender and creating career advancement opportunities for our team internally that can benefit them and their families.”