Diversified Energy Co. PLC completed its co-investment with funds managed by Oaktree Capital Management LP to acquire certain Cotton Valley and Haynesville upstream assets and related facilities in Louisiana and Texas from Tanos Energy Holdings III LLC.
Oaktree Capital Management is co-investing under an October 2020 joint participation agreement. Total cash consideration for the acquisition is $308 million.
The deal is the third in Diversified’s new central regional focus area where it expects to replicate its Appalachia region business.
Current production of the acquired assets is 14,000 boe/d (82 MMcfed) with 92% from 390 net operated wells with an average production-weighted well age of 9 years, and PDP reserves of 40 MMboe (241 bcfe), Diversified said in an Aug. 18 statement.
The assets are in addition to Diversified’s second central region deal to acquire Cotton Valley assets from Indigo Minerals LLC, and includes additional working interest in 42 wells previously acquired from Indigo (OGJ Online, May 4, 2021). In another deal, the company acquired Barnett shale upstream assets from Blackbeard Operating LLC (OGJ Online, May 28, 2021).
Diversified Energy will retain about 55 Tanos field personnel and previous contractors.
