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Matador Resources Acquires Core Delaware Basin Acreage in $1.1 Billion Lease Deal

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Matador Resources (MTDR), on Thursday, reported a successful bolt-on acquisition of 5,154 net undeveloped acres at the core of the Delaware Basin, in a $1.1 billion lease deal via the Bureau of Land Management's sale of oil and gas assets this week.

Located in Southeast New Mexico, the company said that this new acreage, within the 'core-of-the-core' of the Delaware Basin, was directly adjacent to its existing operating units, allowing for longer laterals, multi-well developments and additional operating efficiencies in some of its lowest-cost drilling areas.

Matador said the newly acquired acreage contains nine or more prospective formations and adds more than 141 net operated drilling locations normalized to two-mile laterals.

It added that the leases carry an 87.5% net revenue interest, referring to the share of output it stands to receive, and a 10-year term across all depths, which means it has the right to explore and produce oil and gas from that acreage for up to 10 years.

The company said the purchase price implies roughly $7.3 million per location after accounting for anticipated midstream value. The acquisition is expected to be funded through cash on hand and borrowings under its existing credit facility.

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