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Civitas Resources to Acquire Assets in Midland Basin for USD 2.1bn.

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MANews-(C)2009-2023

US-based oil and gas producer Civitas Resources (NYSE: CIVI) has entered into an agreement with Rotterdam-based energy producer Vencer Energy, a Vitol investment, to acquire oil producing assets in the Midland Basin for approximately USD 2.1bn, the company said.

The acquisition is expected to close in January 2024 with an effective date of January 1, 2024.

The acquisition is priced at 2.8x 2024 estimated Adjusted EBITDAX at USD 80/Bbl NYMEX WTI and USD3.50/MMBtu NYMEX Henry Hub, which compares favorably to recent transactions in the Permian Basin.

Approximately 80% of the purchase price is underwritten by the value of proved developed and proved developed non-producing reserves, with significant upside in future developments.

The acquisition is expected to deliver an estimated 5% uplift to Free Cash Flow per share in 2024.

Pro forma, Civitas expects to generate approximately USD1.8 bn of Free Cash Flow in 2024 at USD 80/Bbl and USD 3.50/MMBtu.

The acquisition Increases Permian Basin scale, balancing Civitas' portfolio between premium Permian and DJ positions: The acquisition will add approximately 44,000 net acres in the Midland Basin and current production of approximately 62 Mboe/d (approximately 50% oil).

Pro forma for the acquisition, Civitas' 2024 estimated Permian production is expected to be about 170 Mboe/d (approximately 50% oil).

Total consideration for the acquisition consists of approximately 7.3 m shares of...

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