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Earthstone Energy to Acquire Midland Basin Assets
Earthstone Energy Inc. entered into definitive agreements to acquire privately held operated assets located in the Midland Basin (the Bolt-On Acquisition) from two sellers unaffiliated with Earthstone. The aggregate purchase price of the Bolt-On Acquisition is approximately $73.2 million consisting of $49.2 million in cash, subject to customary purchase price adjustments, and approximately 2.6 million shares of Earthstone’s Class-A common stock valued at $24 million based on a closing share price of $9.20 on September 30, 2021. The Bolt-On Acquisition is expected to close by the middle of the fourth quarter of 2021 with an effective date of July 1, 2021.
Highlights of the acquired asset base and operations include:
- Average daily production of 4,400 Boepd (26 percent oil, 52 percent liquids) during September 2021
- Projected next 12 months adjusted EBITDAX of approximately $42 million
- $116 million PDP PV-10 as of July 1, 2021, with associated reserves of approximately 13.3 MMBoe (11 percent oil, 31 percent NGL, 58 percent natural gas) based on NYMEX strip pricing as of September 30, 2021
- Low operating cost, high margin asset base with operating synergies when added to Earthstone’s existing assets
- ◦Sale/Acquisition
