Crescent Energy Buys Eagle Ford Assets for $168 Million
(P&GJ) — Crescent Energy has announced the acquisition of assets from a private Eagle Ford operator for $168 million, the company announced on Sept. 4. The transaction further strengthens Crescent's presence in the Central Eagle Ford region. This move builds on Crescent's recent expansion efforts, including its acquisition of SilverBow Resources Inc.
“This transaction builds upon our momentum in the Eagle Ford, where we see substantial opportunity for further growth and compelling investment returns,” said Crescent CEO David Rockecharlie. “We are adding low-decline oil production and high-quality acreage adjacent to our existing position, with meaningful opportunity to further increase returns through improved operating efficiency. We are pleased with this attractive acquisition, and we believe in our ability to continue to accretively scale Crescent.”
The acquisition is anticipated to enhance Crescent's financial metrics significantly. It is expected to increase the company's operating cash flow, levered free cash flow, and net asset value per share, achieving returns that exceed the company's 2.0x Multiple on Invested Capital (MOIC) target. The newly acquired assets will directly complement Crescent's existing operations in Frio, Atascosa, La Salle, and McMullen counties, offering opportunities for improved operational efficiency and extended drilling capabilities.
The deal adds approximately 30 oil-weighted development locations to Crescent's portfolio, with favorable net revenue interests from owned minerals that are expected to further boost returns. In addition to the development locations, Crescent will gain about 5,300 net royalty acres, over 3,500 surface acres, and midstream assets. These additions are likely to enhance the company's operational flexibility and increase margins.
Despite this expansion, Crescent's financial stability remains strong. The company's leverage ratio is projected to remain stable, with net debt to trailing 12-month Adjusted EBITDAX expected to stay below the publicly stated maximum leverage target of 1.5x. Crescent has also entered into additional hedges as part of its risk-management strategy.
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