FourPoint Energy LLC has acquired certain producing and undeveloped oil and gas properties and related midstream assets in the Western Anadarko Basin from affiliates of EnerVest Ltd. Under the terms of the agreement, FourPoint Energy has purchased for $268 million an ownership stake in both the Laredo Petroleum and SM Energy acquisitions closed by EnerVest in the second half of 2013. The acquisition includes interest in over 1,200 producing wells with net production to FourPoint Energy of over 35 MMcfed.
FourPoint Energy and EnerVest have also entered into a Joint Development Agreement and Area of Mutual Interest Agreement to own, operate and develop oil and gas properties in the Western Anadarko Basin. Each company will hold a 50% interest in the AMI and EnerVest is designated as operator. The companies hold a strong acreage position with over 90,000 net acres in one of the most prolific multi-pay regions of the country. The companies will share all future lease and producing property acquisitions within the joint development area, encompassing 14 counties in Texas and Oklahoma and will work together as partners to advance an aggressive acquisition and development plan.
“This transaction combines two talented management teams and technical staffs. John Walker of EnerVest has a proven track record and for George Solich, FourPoint Energy represents his fourth oil and gas start up and Mr. Solich has a solid history of operating in the Anadarko basin. For EnerVest, this transaction represents a degree of de-leveraging which is consistent with its strategy of maintaining a strong balance sheet," noted independent oil and gas analyst John White.
This will be the first entry back into the Western Anadarko Basin for FourPoint Energy since the sale of their previous company, Cordillera Energy Partners to Apache Corp. in 2012.
FourPoint Energy will direct its initial focus to the core areas of the Western Anadarko and Permian Basins. "The Permian Basin offers multi-stacked pays with extensive vertical well control with industry transitioning to a more robust horizontal development model," said Kamil Tazi, FourPoint executive vice president and COO.
Simultaneous with the EnerVest transactions, FourPoint Energy raised over $1 billion of committed capital including $200 million in direct private equity and $800 million in term debt from EIG Global Energy Partners LLC and funds advised by GSO Capital Partners LP. In addition, FourPoint Energy also entered into a $250 million credit facility with JPMorgan Chase Bank NA and Wells Fargo Bank NA.
The debt and equity securities have not been and will not be registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
FourPoint Energy is a privately held acquisition, exploration and production company headquartered in Denver, CO.
Jefferies LLC acted as sole financial advisor, JPMorgan Securities LLC acted as sole lead arranger and book runner on the credit facility and Andrews Kurth LLP acted as legal advisor to FourPoint Energy in connection with the transaction.