Private oil and gas company CP Exploration (CPX) announced today that it has closed the sale of certain Delaware Basin assets to Resolute Energy Corporation (NYSE: REN) for $160 million. The assets include approximately 2,200 net acres in the core of the southern Delaware Basin, and approximately 2,400 net, undeveloped acres in the Alpine High. The primary asset, located near the town of Orla, Texas in Reeves County, was a drill-to-earn farm-out with a major independent and included significant infrastructure, two recently completed horizontal wells producing from the upper Wolfcamp, seven upper Wolfcamp horizontal wells, and 320 surface acres that provide operational efficiencies for the future development.
“We are excited about this asset sale to Resolute and believe it is a valuable and advantageous deal for both parties,” said CPX President and CEO Tom Powell. “We look forward to continuing to utilize our acquisition and drilling expertise to roll out CP Exploration III, and again concentrate in the Permian Basin, focused on drill-to-earn and joint venture partnerships with major independents.”
In 2015, CPX closed on its farm-out agreement on the Orla asset and drilled its first horizontal well, landing in the Upper Wolfcamp. The well was completed in 2016 with 4,400 feet of gross perforated interval and achieved a 24-hour IP rate of 3,436 million cubic feet per day (mcfd), 708 barrels of oil per day (bopd) (1,281 barrels of oil equivalent per day (boepd)). CPX then drilled and completed its second Upper Wolfcamp horizontal well, also with 4,400 feet of gross perforated interval. This well achieved a 24-hour IP rate of 3630 mcfd and 813 bopd (1418 boepd).
Following the completion of the second well, CPX drilled and cased four more nominal 5,000-foot lateral length wells, two 7,500-foot nominal horizontal wells, and participated in the drilling and casing of a 10,000-foot nominal lateral length well. During these operations, CPX acquired its Alpine High acreage in southwestern Reeves County as well as other acreage positions adjacent to the Orla asset.
Founded in 2007, CPX is co-located in Dallas and Lafayette, LA. The company is privately funded by management and private investors. Since its inception, CPX has completed six divestitures; four in the Bakken, one in the Permian Basin, and one in the Delaware Basin, along with multiple small sales, for a four times return on investment.