Parsley Energy has signed an agreement to purchase mineral rights of approximately 30,000 acres consisting of Parsley leasehold and other nearby properties in the Pecos and Reeves counties of Texas in the Southern Delaware Basin, for $280.5m.
This deal, payable in cash, is expected to close by 14 July.
Parsley plans to fund this acquisition through debt and equity issuances.
The firm acquired mineral rights in 29,813 acres with an average royalty interest of 17.5%.
Mineral rights is expected to improve net revenue interest (NRI) on approximately 186 gross / net horizontal drilling locations in the upper Wolfcamp interval.
The firm is also reviewing the potential for additional flow units in the Wolfcamp complex and the Bone Spring interval on acreage associated with the acquired mineral rights.
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The estimated net current production associated with acquired mineral rights is 280 barrels of oil equivalent every day.
Parsley leasehold represents 82% of mineral acreage while the remaining is leased and operated by other operators.
The firm also secured surface rights on approximately 80% of mineral acreage, thereby eliminating compensation for surface damages and water procurement, besides other costs, and also facilitating optimal well and facility placement.
As per the earlier plan, Parsley expects to complete five to seven wells in the Southern Delaware Basin this year.
Out of these, it expects three to five wells to be completed on the acquired mineral acreage.
Further, Parsley acquired additional working interests in the company’s leasehold in Pecos and Reeves counties totaling 885 net acres for $9m.
This deal, paid in cash, closed on 10 May.