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NOG Successfully Acquires Utica Shale and Delaware Basin Operations
02/20/2024
Northern Oil and Gas (NOG) has successfully completed two acquisitions, investing $162.6 million in properties within the Utica Shale and the northern Delaware Basin.
In November 2023, NOG ventured into the Utica Shale by acquiring interests from a private seller, including less than one producing well and slightly over one well in development, spanning several counties in Ohio. These areas, primarily operated by Ascent Resources, focus on extracting oil and gas from the Point Pleasant Formation and the Utica Shale, with the Ohio assets being a significant part of this strategy.
Additionally, NOG expanded its presence in the Delaware Basin through another deal, adding interests in about 3,000 acres in New Mexico's Lea and Eddy counties. This addition complements NOG's existing stakes in the area, covering 90% of the leasehold.
Originally pegged at $174 million, the final investment was adjusted to $162.6 million, including closing costs and adjustments, paid over the end of 2023 and the start of 2024. The payment included a significant deposit made at the agreement signing, with the balance settled in early 2024, subject to final adjustments.
For the second quarter of 2023, NOG reported record quarterly production, highlighting a substantial year-over-year increase in both oil and natural gas production. This growth was part of their updated guidance, which forecasted an annual production range of 96,000 to 100,000 barrels of oil equivalent per day (Boe/d) and set a total budgeted capital expenditure between $764 million to $800 million.
About NOG
NOG stands out as a leading investor in non-operated energy assets across America, focusing on strategic acquisitions in the country's top hydrocarbon-producing regions. The company continues to focus on low-risk, high-return portfolio diversified by geography and commodity, primarily targeting premier regions of the United States such as the Permian, Williston, and Marcellus basins.
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Ain't Nothing Like a $2 Billion Deal: Oasis Sells Midstream Affiliate to Crestwood
Crestwood & Oasis Midstream merge to create a top Williston #basin player. $1.8 billion deal is expected to close during the Q1 of 2022. The transaction will result in a 21.7% ownership stake for Oasis in Crestwood common units. The remaining ownership of Oasis in Crestwood will also be of benefit to the company since it will create a diversified midstream operator with a strong balance sheet and a bullish outlook after this accretive merger.
TOP 2022 vs 2023 Permian Producers Overview by Rextag
The Permian Basin, America's prime oil region, faced significant challenges during the COVID-19 pandemic. The industry saw a drastic reduction in rigs and fracking crews and had to close some operations as oil prices plummeted, leading to widespread restructuring. Now, the Permian is making a strong comeback. Over the last three years, exploration and production companies (E&Ps) have increased their drilling activities. They're focusing on spending wisely and maximizing returns to their investors. The Permian's role is crucial. It was projected to contribute over 5.98 million barrels of oil per day in December, making up about 62% of the total oil production in the Lower 48 states, as per the EIA.
Kinetik Holdings recently announced a series of transactions in the energy sector. They struck a deal to buy Durango Permian infrastructure for $765 million. At the same time, they're selling their 16% share in the Gulf Coast Express Pipeline to ArcLight Capital Partners for $540 million. The total purchase cost includes $510 million in cash paid immediately and an additional $30 million that will be paid later, depending on whether they decide to expand further.
Recently, the Permian has seen significant acquisitions: Exxon Mobil purchased Pioneer Natural Resources for about $60 billion. Diamondback Energy's $26 billion deal to acquire Endeavor Energy Resources is currently on hold due to requests from the U.S. Federal Trade Commission. Occidental’s acquisition of CrownRock for $12 billion in the Midland.
EOG Resources is pushing boundaries in Ohio's Utica oil play and now drilling on the Sable pad, also located in Noble County. This site features the 3.7-mile lateral currently under construction. The company's first multi-well pads in the area Timberwolf and Xavier have each produced over 200,000 barrels of oil since their inception—Timberwolf in August and Xavier in October. A third site, the four-well White Rhino pad in Noble County, is also showing promising early results, according to Keith Trasko, EOG’s Senior Vice President of Exploration and Production, who noted the wells are performing as expected in their initial weeks.