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Matador Expands Delaware Basin Position With $1.14 Billion Lease Deal

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Matador Resources Company (MTDR) acquired 5,154 net undeveloped acres in the New Mexico Delaware Basin for about $1.14 billion, TPH Energy said Friday.

Matador secured the acreage during this week's Bureau of Land Management lease sale, paying roughly $222,000 per acre for the undeveloped land, according to TPH Energy.

Management expects the acquisition to add 141 net operated drilling locations on a two-mile equivalent basis, providing more than one year of inventory at the company's recent drilling pace.

Matador valued the drilling inventory at about $7.3 million per location after accounting for expected midstream value, while the acreage carries an 87.5% net revenue interest and a 10-year lease term across all depths.

The company plans to fund the acquisition with cash and its credit facility, and management expects to repay a substantial portion of the balance by the end of 2026 and in full by the first half of 2027.

TPH Energy said the acquisition has a greater financial impact on Matador because the transaction value is roughly 15% of the company's $7.0 billion market capitalization.

Matador shares fell 5.8% Thursday, underperforming Devon Energy's (DVN) 2.8% decline and the SPDR S&P Oil & Gas Exploration & Production ETF's 2.3% drop as investors speculated Matador submitted the winning bids through the Federal Abstract Company alias, according to TPH.

Price: $56.48, Change: $+0.39, Percent Change: +0.70%

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