Blackstone (NYSE:BX) (“Blackstone”) today announced that funds managed by Blackstone Energy Partners L.P. have entered into a strategic 50/50 partnership with Sanchez Energy Corporation (NYSE:SN) (“Sanchez”) to acquire Anadarko Petroleum Corporation’s (NYSE: APC) (“Anadarko”) working interest in approximately 318,000 gross acres in the Western Eagle Ford for approximately $2.3 billion.
“We are very pleased to acquire – in partnership with Sanchez Energy, a uniquely positioned and best-in-class Eagle Ford operator – these world-class Eagle Ford oil and gas shale assets from Anadarko. Our experience and success in investing in the oil and gas sector and the Eagle Ford Shale and our strategic partnership with Sanchez gives us confidence that this investment will be successful. We look forward to building upon our partnership with Sanchez through this acquisition and to continue to grow through future acquisitions in this part of the basin,” said Angelo Acconcia, a Senior Managing Director at Blackstone Energy Partners who oversees their oil and gas investments.
The acquired assets (155,000 net acres to Sanchez Energy and Blackstone) are primarily located in Dimmit and Webb counties, contiguous to Sanchez’s existing assets. Sales volumes from these properties totaled approximately 45,000 barrels of liquids per day and approximately 131 million cubic feet of natural gas per day at the end of the fourth quarter of 2016. The acreage includes approximately 130 gross drilled but uncompleted wells, which will drive initial production growth.
“This transaction and partnership with Sanchez is illustrative and consistent with our history and focus on partnering with oil and gas companies to help effectuate strategic transactions and provide the growth capital to realize the long-term value associated with the company’s assets,” added Acconcia.
“We are excited to be in a 50/50 partnership with Blackstone Energy Partners, who we partnered with here given their unique ability to provide a large scale, customized financial solution, their best in class reputation in the energy industry and who will work collaboratively with us to support the Company and facilitate future growth,” said Tony Sanchez, III, Chief Executive Officer of Sanchez Energy.
“Our extensive experience over the last two decades as an investor across all segments of the energy sector, access to equity and debt capital on a very large scale and a history of creative, flexible solutions to complex challenges, make Blackstone a uniquely well positioned partner for energy companies seeking to fund their continued growth through the inherent volatility and capital intensive nature of the energy industry,” added David Foley, Chief Executive Officer, Blackstone Energy Partners. “Our partnership with Sanchez Energy provides capital for the continued development of this acreage, creating additional jobs for American workers and providing significant benefits to the economy.”
The transaction is expected to close in the first quarter of 2017.
Kirkland & Ellis served as legal advisor and Jefferies & Company, Inc. served as the sole financial advisor to Blackstone. JPMorgan Chase & Co., Citigroup Inc. and Morgan Stanley are providing committed debt financing to back Blackstone’s working interest purchase.