FORT WORTH, Texas–(BUSINESS WIRE)–TXO Partners, L.P. (NYSE: TXO) (“TXO”) announced today that it has entered into separate purchase agreements with Eagle Mountain Energy Partners (A Pearl Energy Investments Portfolio Company) and a private company to purchase assets in the Elm Coulee field in Montana and the Russian Creek field in North Dakota for total cash considerations of $243 million and 2.5 million common units of TXO, subject to customary purchase price adjustments.
“TXO uniquely operates as a production and distribution entity, which focuses on cash flow from our legacy assets. As significant owners, our leadership is focused, determined and disciplined,” stated Bob R. Simpson, Chairman and CEO. “This acquisition in the Elm Coulee field represents the return to a region where our team previously had success. We expect the significant oil-in-place targets, with the application of our technology, to create equity value while delivering high returns.”
“With an eye to a stronger future, we have diligently looked at many candidates in the last seventeen months as a public company. We believe the combination of these two assets fits perfectly with our expertise and capital allocation strategy. These transactions provide the right blend of low decline rate, high margin and growth potential for TXO,” commented Brent Clum, the President of Business Operations and CFO. “We expect these assets to be accretive on every relevant measure, but most importantly to cash flow and distributions. It’s a natural evolution to creating equity value.”
Each of the transactions are expected to close in the third quarter of 2024, subject to satisfaction of customary closing conditions. If consummated, the transactions are expected to add approximately 4,500 daily barrels of oil equivalent production (~90% liquids) and Proved Developed reserves of approximately 17,000 Mboe, as of April 1, 2024 as determined by Cawley, Gillespie & Associates using SEC pricing.
TXO’s counsel in connection with the Acquisitions is Welborn Sullivan Meck & Tooley, P.C. EMEP’s financial advisor for the sale of its assets to TXO is Jefferies LLC and its counsel is O’Melveny & Myers LLP.
About TXO Partners, L.P.
TXO Partners, L.P. is a master limited partnership focused on the acquisition, development, optimization and exploitation of conventional oil, natural gas, and natural gas liquid reserves in North America. TXO’s current acreage positions are concentrated in the Permian Basin of West Texas and New Mexico and the San Juan Basin of New Mexico and Colorado.