Vantage to buy QEP’s Williston basin assets in $1.7-billion deal

Nov. 19, 2018
QEP Energy Co., a wholly owned subsidiary of Denver-based QEP Resources Inc., has agreed to sell all its assets in the Williston basin in North Dakota and Montana, which includes the South Antelope and Fort Berthold leasehold and various mineral interests, to Vantage Acquisition Operating Co. LLC, Denver, a subsidiary of Vantage Energy Acquisition Corp., for as much as $1.725 billion, subject to purchase price adjustments.

QEP Energy Co., a wholly owned subsidiary of Denver-based QEP Resources Inc., has agreed to sell all its assets in the Williston basin in North Dakota and Montana, which includes the South Antelope and Fort Berthold leasehold and various mineral interests, to Vantage Acquisition Operating Co. LLC, Denver, a subsidiary of Vantage Energy Acquisition Corp., for as much as $1.725 billion, subject to purchase price adjustments.

The deal moves QEP closer to its goal of becoming a Midland basin operator (OGJ Online, July 17, 2017). The company’s Haynesville position is yet to be sold.

For the buyer—to be renamed Vantage Energy Inc.—the deal creates a large-scale Williston basin operator with “a robust base of oil-weighted production and an attractive set of development drilling and refrac projects,” Vantage said. The acquired assets consist of more than 100,000 net acres currently producing 46,000 boe/d (67% oil, 83% liquids). Upon closing, Vantage will hold 102,800 net acres with an 81% and 79% net revenue interest at South Antelope and Fort Berthold, respectively.

Vantage will be led by Roger Biemans as chairman, president, and chief executive officer. David Wolf, CEO of Fuse Energy, will join as chief financial officer. Vantage will maintain a seven-person board, including two appointees named by NGP Vantage and four additional independent directors. The company expects to retain a “significant portion” of QEP’s High Plains business unit team, including operations, engineering, geoscience, land, administrative and finance groups, it said.

The purchase price is comprised of $1.65 billion in cash and contractual rights to receive up to $50 million and $25 million in Vantage common stock dependent on daily volume weighted average trading prices during the 5-year period following the deal’s close.

Assuming no redemptions of VEAC public shares, the VEAC public investors will own 63% of the issued and outstanding shares of common stock of Vantage immediately following the closing, while NGP Vantage will own 37%.

Subject to conditions, including Vantage shareholder and regulatory approvals, the deal is expected to close late in the first quarter or early in the second quarter 2019.