Diamondback Energy: Not Much Of A Slowdown In 2016
Richard Zeits • 12 Comments
Richard Zeits • 12 Comments
Tue, Sep. 6, 2:48 PM
- EOG Resources (EOG +6.7%) surges more than 6%, as analysts say its $2.5B acquisition of Yates Petroleum strengthens its Permian Basin presence at an inexpensive price.
- Tudor Pickering & Holt analysts say EOG is paying $7K-$8K/acre for the Delaware Basin properties, assuming a value on proven reserves that are producing and still being developed of ~$800M for the 29.6M boe/day EOG said it is picking up (48% oil).
- Simmons analyst Pearce Hammond calculates that the deal comes in well below some recent transactions in the play, including Diamondback Energy's (FANG +0.1%) $560M purchase of Luxe Energy, which he says came in at $26K-$27K/acre.
- Cowen analysts say EOG is paying less than $1M per new premium location, and the deal is $2/share accretive to net asset value just on initial locations.
Wed, Jul. 13, 7:55 AM
- Diamondback Energy (NASDAQ:FANG) -2.1% premarket after agreeing to acquire more than 19K net acres and related assets in the Southern Delaware Basin for $560M.
- The assets, primarily located along the Pecos River in Reeves and Ward counties, include ~1K boe/day of current net production.
- FANG also raises its 2016 production guidance to 38K-40K boe/day, up 11% from the midpoint of earlier guidance of 32K-38K boe/day, due to increasing activity from 3-4 rigs in H2 2016 as well as continued strong well performance.
- FANG now plans to complete 60-75 gross horizontal wells this year, vs. its prior outlook for 35-70 gross horizontal wells; as a result, the company raises its 2016 capex guidance to $350M-$425M from $250M-$375M prior.
- To help fund the deal, FANG announces a public offering of 5.5M common shares, with an underwriters option to purchase up to an additional 825K shares.
Sep. 29, 2014, 12:26 PM
- Encana’s (ECA +2.3%) takeover of Athlon Energy (ATHL +24.6%) is good news for Diamondback Energy (FANG +2.3%) and Energen (EGN +2.2%), according to analysts at Sterne Agee.
- The acquisition implies a value of $98/share for FANG, Sterne says, based on FANG's 85K net acre leasehold position, estimated 19.8K boe/day of Q3 production, $585M of assumed debt, and a $1.7B market value for the Viper Energy Partners (NASDAQ:VNOM) units it owns.
- The firm sees even more upside for EGN, as ECA’s price implies a value of $102/share for EGN, based on 180K net acres across both sides of the Permian Basin, 48K boe/day of Q3 Permian Basin production, 132M cfe/day of Q3 San Juan Basin, and $835M of pro forma net debt as of Sept. 30.
- Permian producers Laredo Petroleum (LPI +5%), Parsley Energy (PE +5%) and RSP Permian (RSPP +4.8%) also are higher following the acquisition news.
Jul. 21, 2014, 8:24 AM
- Diamondback Energy (NASDAQ:FANG) -1.9% premarket agrees to acquire leasehold interests in Texas' Midland Basin from unnamed sellers for a combined $538M.
- FANG says the acquisition includes 14,773 gross acres with net production of ~2,173 boe/day in May from 131 gross producing wells; net proved reserves are ~5.2M boe; FANG expects the deal to add 13,136 net acres to its total position in the Midland Basin, increasing it to more than 85K net acres.
- To fund the deal, FANG plans to launch of a public offering of 5M common shares; the underwriters will have an option to purchase up to an additional 750K shares.
- FANG also raises its projected FY 2014 daily production by another 1K to a new range of 17K-19K boe/day, not including any volumes from the Midlands Basin purchase.
Sep. 3, 2013, 4:45 PM
- Diamondback Energy (FANG) agrees to acquire Midland County, Tex., mineral interests from an unidentified third party for ~$440M; more than half of the minerals already are operated by FANG.
- In an operations update, FANG says its first operated Andrews County horizontal well produced at a peak IP rate of 613 boe/day (85% oil) and has averaged 585 boe/day over the last seven days.
- Shares -0.5% AH.