Updated May 20 to include asset detail from BKV Corp.
Subsidiaries of BKV Corp., Denver, will pay $750 million to acquire ExxonMobil’s operated and non-operated North Central Texas Barnett shale gas assets, ExxonMobil said in a release May 19. Additional payments are contingent on future natural gas prices, the oil and gas major said.
BKV currently holds about 292,600 net acres in Denton, Parker, Tarrant, and Wise counties in Texas with current production of 550 MMcfd (gross), according to the company website. The private company was formed in 2015 by Thailand-based Banpu Public Co. Ltd. BKV acquired a large Barnett shale position through a $770-million deal with Devon Energy Corp., Oklahoma City, in 2019 (OGJ Online, Dec. 18, 2019).
ExxonMobil removed the assets—operated by subsidiaries XTO Energy Inc. and Barnett Gathering LLC—from its development plan in 2020 as part of a larger strategy to prioritize investments on “advantaged assets with lowest cost of supply,” it said.
XTO Energy had built a large position in major US shale, tight gas, and coalbed methane plays, amassing a 277,000-acre position in the Barnett specifically, before its 2009 acquisition by ExxonMobil in an all-stock deal valued at $41 billion (OGJ Online, Dec. 14, 2009; Jan. 1, 2010).
Transaction detail
At closing, BKV will acquire some 160,000 total net acres primarily in Tarrant, Johnson, and Parker counties, with additional smaller positions in Jack, Wise, Denton, Erath, Hood, and Ellis counties, BKV said in a separate release May 20. Average working interest is 93% in over 2,100 wells with operatorship positions, the company continued. Through the deal, BKV also will acquire some 750 miles of gathering pipelines, compression, and processing infrastructure.
As part of the deal, all employees of ExxonMobil subsidiaries in the Barnett shale will receive full employment offers with BKV, according to ExxonMobil.
The sale is expected to close in this year’s second quarter.