Northern Oil and Gas, Inc. have announced that it has entered into a definitive agreement to acquire a 30 percent undivided stake in the Forge Assets in the Delaware Basin, in partnership with Vital Energy, Inc., for a purchase price net to NOG of $162.0 million in cash, subject to typical closing adjustments.
The Acquired Assets are primarily located in Ward and Reeves Counties, Texas and include approximately 10,200 net acres, 30.5 net producing wells, 2.3 net wells-in-process and ~20 low-breakeven net undeveloped locations. Upon closing, the operator of the assets will be Vital, with NOG participating in development pursuant to cooperation and joint operating agreements entered into with Vital in connection with the acquisition.
Recent production on the Acquired Assets was approximately 3,400 Boe per day (2-stream, 79 percent oil). For the second half of 2023, NOG expects average production of >3,750 Boe per day (2-stream, 79 percent oil) and approximately $17 million of capital expenditures.
The effective date for the transaction is March 1, 2023, and NOG expects to close the transaction at the end of June 2023. The obligations of the parties to complete the transactions contemplated by the purchase agreement are subject to the satisfaction or waiver of customary closing conditions.
“This transaction crystallizes NOG’s position as a reliable and consistent partner for the purchase and development of high-quality properties,” commented Nick O’Grady, NOG’s chief executive officer. “We are excited to work alongside our partners at Vital to develop the Forge Assets with strong alignment and cooperation.”
“As we enter into this joint acquisition, we are taking NOG’s capabilities and opportunity set to the next level, adding yet another arrow to our M&A quiver,” commented Adam Dirlam, NOG’s President. “The Forge Assets are high-quality with the opportunity for clear and concise development to deliver the consistent performance our investors have come to expect.”
For more information visit www.northernoil.com
