Northern Oil and Gas Inc. (NOG) has agreed to acquire certain Midland basin assets in Texas from Laredo Petroleum, Tulsa, for $110 million in cash.
The Howard County, Tex., assets include about 1,600 acres, 6.4 net producing wells, 1.6 net wells-in-process, and about 8 net undeveloped locations, NOG said. Almost all are operated by SM Energy. At closing, asset production of more than 1,600 boe/d (2-stream, 87% oil) is expected, with average production over 1,800 boe/d over the next 12 months post-closing (2-stream, 86% oil), NOG said in a release Aug. 17.
NOG expects less than $5 million of capital expenditures to be incurred following the sale this year and does not anticipate revising 2022 capital expenditure guidance for the acquisition.
After closing, expected in October 2022, Laredo plans to adjust production guidance, it said in a separate release Aug. 17, noting the divestiture does not reduce the company's 8-year inventory of operated drilling locations.