WildHorse to acquire Eagle Ford assets from Anadarko, KKR for $625m

US-based WildHorse Resource Development has signed a definitive agreement Anadarko Petroleum and affiliates of Kohlberg Kravis Roberts & Co., (KKR) to acquire 111,000 net acres and associated production in the Eagle Ford Shale, East Texas.

The transaction involves a cash and stock consideration of $625m and is subject to certain customary closing conditions.

The proposed acquisition contains assets of 111,000 net acres, located in Burleson, Brazos, Lee, Milam, Robertson, and Washington Counties, which are close to WildHorse’s existing acreage position.

The move will create a contiguous acreage base of 385,000 net acres, making WildHorse the second largest operator in the entire Eagle Ford trend.

WildHorse is expecting high economic returns from these assets on a full cycle basis.

Net production for the fourth quarter of 2016 was around 7.6mmboed containing approximately 72% oil and 89% liquids from 68 Eagle Ford, 299 Austin Chalk, 19 Buda / Georgetown operated wells.

WildHorse resource development chairman and CEO Jay Graham said: "This transformative acquisition presented us with a strategic opportunity to consolidate our acreage position.

“WRD’s pre-acquisition drilling schedule already includes 36 wells immediately adjacent to the acquired acreage.

“With the new acquisition, WRD can further optimise pad location and development planning with fewer limitations. As a result, this transaction immediately adds value to our existing programme.”

In addition to a cash consideration of approximately $556m to be paid to Anadarko Petroleum, the transaction value of $625m also includes 6.3 million shares of WildHorse Resource common stock valued at approximately $69m, to be issued to Kohlberg Kravis.

The company has reported that the acquisition will enable further optimisation of unit location, lateral length, and development in its Eagle Ford position.

The transaction is scheduled to close on or by 30 June this year.