Deal insight

KKR-backed Venado buys Eagle Ford assets from SM Energy for US$800 million

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Report summary

On 3 January, SM Energy announced the sale of its non-operated Eagle Ford position to KKR-backed Venado Oil and Gas, LLC for US$800 million. The deal includes 37,500 net acres in the western Eagle Ford producing 27,270 net boe/d, and a 12.5% interest in the Springfield Gathering System. It is the first large acquisition by the partnership between KKR and Venado, which aims to build scale and a long-term business in the play. This is an opportunistic acquisition for Venado. We estimate that the price attributable to the upstream assets was 20% below our commercial valuation. Future development depends on the operator, Anadarko. Anadarko currently employs <1% of its US onshore capex in the play. However, it is rumoured that Anadarko is marketing its position, thus potential upside exists if a new operator comes in with a renewed focus on the play.

What's included

This report contains

  • Document

    KKR-backed Venado buys Eagle Ford assets from SM Energy for US$800 million

    PDF 1.49 MB

Table of contents

  • Executive summary
  • Transaction details
  • Upstream assets
  • Deal analysis
  • Upsides and risks
  • Strategic rationale
  • Oil & gas pricing and assumptions

Tables and charts

This report includes 10 images and tables including:

Images

  • SM Energy and Anadarko Eagle Ford wells and gathering system

Tables

  • Executive summary: Table 1
  • Upstream assets: Table 1
  • Upstream assets: Table 2
  • Upstream assets: Table 3
  • Deal analysis: Table 1
  • Deal analysis: Table 2
  • Deal analysis: Table 3
  • Oil & gas pricing and assumptions: Table 1
  • Oil & gas pricing and assumptions: Table 2

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