Deal Insight

Permian M&A: Centennial pays US$855m for Silverback's Reeves County acreage

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Report summary

Centennial Resource Development, a recently formed pure-play Permian operator, will acquire 35,000 net acres in the Delaware Basin of west Texas from Silverback Exploration for US$855 million. The assets, located in Reeves County, are adjacent to Centennial's existing position and include current net production of approximately 3,500 boe/d. Centennial will operate 95% of the acreage, with an average working interest of 88%. The acquisition acreage, located in our Reeves Core sub-play, boasts a breakeven price of US$40/bbl, which is among the lowest in the US Lower 48. The deal provides Centennial with additional horizontal inventory that will extend field development life and allow for long-term production growth. Further, the continuity of its pro forma acreage position will allow the company to add value with extended laterals and operational synergies.

What's included

This report contains

  • Document

    Permian M&A: Centennial pays US$855m for Silverback's Reeves County acreage

    PDF 689.02 KB

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 9 images and tables including:

Tables

  • Executive summary: Table 1
  • Upstream assets: Table 1
  • 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

Images

  • Notable 2016 Delaware Basin deals
  • Silverback and Centennial horizontal well locations in the Delaware Basin

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