Kimbell Royalty Partners said Monday it’s closed the previously announced purchase of oil and gas royalty assets from EnCap Investments for roughly $171.6 million in Kimbell Royalty Operating stock.
The acquisition includes oil and natural gas mineral and royalty interests previously controlled by EnCap through Phillips Energy Partners, Phillips Energy Partners II and Phillips Energy Partners III, and is expected to be immediately accretive to distributable cash flow per unit.
The purchase includes royalty interests with roughly 77% of revenue from oil and natural gas liquids, and over 64% of production from the Eagle Ford and Haynesville Shale plays, and the Permian and Powder River basins.
The deal also adds roughly 1,600 barrels of oil-equivalent per day (Boe/d) of production, as well as 17 rigs actively drilling the acreage, Kallanish Energy reports.
In addition, the acquisition adds roughly 12,200 net royalty acres, increasing Kimbell’s total net royalty acreage position by 9%, to 144,100 net royalty acres across the Lower 48 U.S. states.
“With the closing of this acquisition, we are off to a great start to 2019,” said Bob Ravnaas, CEO of Kimbell’s general partner. “We continue to see strong activity across our acreage position as evidenced by the 90 rigs currently drilling on our acreage, which is approximately 9% of the entire U.S. Lower 48 active drilling fleet.”
Kimbell is entitled to cash flow from production attributable to the deal beginning on Jan. 1, 2019.
This post appeared first on Kallanish Energy News.