APA Corp buying West Texas oil producing land for $700 mln -sources

Earthstone Energy

03/08/2022 20:25

By Shariq Khan and David French
    Aug 3 (Reuters) - U.S. oil producer APA Corp  APA.O  agreed
to pay about $700 million for West Texas properties owned by
closely held Titus Oil & Gas LLC, three people familiar with the
matter told Reuters.
    The deal could be announced as soon as Wednesday, the people
said, adding the purchase would mark a significant pivot to West
Texas for the former Apache Corp after a failed bet on a remote
corner of the top U.S. shale basin. 
    Titus Oil & Gas, backed by private equity firm NGP Energy
Capital Management, is among the private oil and gas companies
investors have put on the market in recent months hoping higher
energy prices would secure bumper valuations.   
    An APA Corp spokesperson declined to comment. 
    Titus and NGP did not immediately respond to requests for
comment.
    Titus and NGP earlier disclosed an agreement to sell New
Mexico oil producing assets to Earthstone Energy Inc  ESTE.N 
for $627 million.  urn:newsml:reuters.com:*:nL4N2YF2D0
    The people, who requested anonymity to discuss confidential
information, did not indicate the size of the land under the
latest deal. It abuts existing APA assets in the Delaware
portion of the Permian basin, one of the people said. 
    When oil prices crashed during lockdowns early in the
coronavirus pandemic, APA briefly suspended U.S. drilling and
reduced activity in Egypt and the North Sea in favor of
developing discoveries off the coast of Suriname.
    Through 2021, APA returned to normal operations in the
Delaware portion of the Permian Basin in Texas, but began
streamlining its Permian assets by selling noncore holdings and
allocated most of its 2022 exploration budget towards Suriname.
    Wall Street analysts expect APA will post a profit of $804
million for the second quarter, compared with $316 million
reported for the same quarter a year-ago as Russia's invasion of
Ukraine has tightened fuel supplies and driven up oil and gas
prices.

 (Reporting by Shariq Khan in Bengaluru and David French in New
York; Editing by David Gregorio)
 ((Shariq.Khan@thomsonreuters.com; Twitter: @shariqrtrs;))