Sanchez Energy, Blackstone purchase 318,000 acres in Western Eagle Ford
On Friday, Sanchez Energy and Blackstone Energy Partners announced they have entered into a 50/50 partnership to purchase approximately 318,000 gross acres in the Western Eagle Ford, valued at $2.3 billion.
The land is primarily located in the Dimmit and Webb counties which are contiguous to Sanchez Energy’s existing assets. The acreage includes about 130 gross drilled, but uncompleted wells which the companies say will drive initial production growth over the next 12 months.
Angelo Acconcia, a Senior Managing Director at Blackstone Energy Partners says “Our experience and success in investing in the oil and gas sector and the Eagle Ford Shale and our strategic partnership with Sanchez gives us confidence that this investment will be successful.”
At the end of Q4, 2016, sales volumes from the newly acquired properties totalled approximately 45,000 barrels of liquids per day and approximately 131 million cubic feet of natural gas per day.
The field’s proven reserves amount to approximately 300 MMboe.
“(W)e view this transaction as a key step toward deleveraging the Company’s balance sheet and anticipate that this strong production growth and reduced leverage will enable us to deliver significant value to our shareholders in the coming years,” said Tony Sanchez, III, Chief Executive Officer of Sanchez Energy.
At the close of the transaction, expected to occur in the first quarter of 2017, Sanchez Energy’s operated position in the Eagle Ford has increased to 585,000 gross acres.