INDEPENDENT RESEARCH firm IHS Markit has provided OGFJ with updated production data for the OGFJ100P periodic ranking of US-based private E&P companies. The rankings are based on operated production only within the US.
Top 10
In this, the installment of year-to-date 2016 private company data, there is some movement in the Top 10 lists when compared to the January issue. Plano, TX-based Vine Oil & Gas LP continues its rise. After moving its way into the Top 10 by overall BOE in the January installment, the company has bumped up a bit higher in this issue-up from No. 10 to No. 8. The company improved its position in the list of top gas producers again, as well-moving from its January spot at No. 6 to its current No. 4 position. Citation Oil & Gas Corp. also moved up, jumping all the way from No. 22 to No. 15 in the Top 10 by overall BOE. The gain also boosted its position among the top liquids producers. The Houston, TX-based company now sits at No. 6 in the list, up three spots from its No. 9 spot in January. On the flip side of the coin, Yates Petroleum and Samson Investment Co. were notably down in the ranks. Yates dropped from No. 11 by overall BOE in January to the No. 34 spot in this installment. Samson Investment is down from No. 8 in January's overall BOE list to No. 12. The company also dropped in the private gas producers list from No. 4 to No. 10.
Capital
Since our last installment published in January, private companies have seen equity commitments from various investment firms. In late February, Post Oak Energy Capital LP, through investment partnerships it manages, led a $200 million equity commitment to Moriah Henry Partners LLC. Henry Energy LP and Moriah Energy Investments LLC will co-invest alongside Post Oak.
Moriah Henry Partners LLC is a Midland-based exploration and production company focused on the acquisition and development of oil and gas properties in the Midland Basin of West Texas. The company will use proceeds from the investment to fund acquisitions in the core of the Midland Basin and subsequently develop those assets.
Henry Energy is a privately held Permian Basin oil and gas producer. The company has been in business in Midland, Texas since 1969. Until 2008, when the entity was sold to Concho Resources, the company operated under the name of Henry Petroleum. After the sale, Henry management quickly reorganized and commenced operations under Henry Energy and its operating company, Henry Resources LLC.
In early March, Admiral Permian Resources LLC noted that it had secured a $600 million line of equity investment co-led by Pine Brook and Riverstone Holdings. Admiral, a newly-formed exploration and production company focused on the acquisition and development of oil and gas properties in the Permian Basin, is headquartered in Midland, Texas.
The company is led by CEO Denzil West, former president and COO of Reliance Energy, which sold the majority of its upstream assets to Concho Resources for $1.625 billion in October 2016. West is joined on the senior management team by co-founders Scott Parkison (chief commercial officer), Jason Henderson (CFO), and Paul Colwell (executive vice president of land).
Admiral plans to pursue opportunities across the Permian Basin and will target a variety of transaction structures - asset and leasehold acquisitions, farm-in transactions and / or joint ventures with existing operators and landowners.
M&A
Also in early March, Denver, CO-based Hawkwood Energy LLC, an independent oil and gas company primarily focused in East Texas, noted the closing of its previously announced acquisition of producing and non-producing assets from subsidiaries of Halcon Resources for $500 million less customary purchase price adjustments. The transaction had an effective date of January 1, 2017.
The acquired assets include approximately 81,000 net acres primarily located in Burleson and Brazos counties, with current gross production of 9,200 Boe/d (80% oil) from 170 wells producing primarily from the Eagle Ford formation. The leasehold position is approximately 80% held by production and 90% operated. With the completion of this transaction, Hawkwood's gross East Texas production will be approximately 14,500 Boe/d (83% oil) from 260 wells in the Eagle Ford, Woodbine, Austin Chalk, and Buda formations. Hawkwood will control more than 180,000 net acres and over 1,000 commercial drilling locations in the Eagle Ford and Woodbine formations.
Hawkwood was founded in 2012 with equity funding from lead investors Warburg Pincus and Ontario Teachers' Pension Plan.
Regulatory
Just before February's end, LINN Energy Inc., the reorganized successor to LINN Energy LLC, and its affiliated entities, noted its emergence from Chapter 11 restructuring. Pursuant to the Plan of Reorganization, LINN and Berry Petroleum LLC now operate as stand-alone, private companies. LINN Energy LLC, LinnCo LLC, and Berry Petroleum Company LLC filed voluntary petitions for restructuring under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas in May 2016. As the largest ever MLP bankruptcy, LINN filed carrying $8.3 billion in debt.
LINN has engaged Jefferies LLC as lead advisor and has initiated a process to explore and evaluate potential strategic alternatives, which includes marketing five non-core assets. The company has retained the following advisors to work alongside Jefferies LLC in the sales process: RBC Richardson Barr will market the Williston and Permian packages, CIBC Griffis & Small will market the South Texas and Salt Creek packages, and Tudor Pickering, Holt & Co. will market California.
Berry is headquartered in Bakersfield, CA, and the company owns and operates oil and gas properties in California, Colorado, Utah, Kansas and Texas.
Through the restructuring, LINN has reduced debt by more than $5 billion to total debt of $1.012 billion and pro forma net debt of $962 million, resulting in $730 million of liquidity.
Also emerging from Chapter 11 is Samson Resources Corp. The company and its subsidiaries satisfied all of the conditions required under its Plan of Reorganization, which was confirmed by the US Bankruptcy Court for the District of Delaware on February 13, 2017. Under the Plan, substantially all of SRC's remaining assets, including its subsidiaries, were transferred to Samson Resources II LLC. The majority of the equity in Samson II was distributed to SRC's second lien lenders, both on account of their claims in the bankruptcy and in connection with a $60 million rights offering. In addition, Joseph A. Mills has been officially appointed by the new Board of Directors as Samson II's president and CEO, succeeding Andrew Kidd, who accepted the position in February 2016, having previously served as general counsel.
Approximately $4 billion of debt and nearly $300 million of annual interest expense was discharged under the plan. Samson II's post-emergence debt financing consists of a first lien revolving credit facility with an initial borrowing base of $280 million, of which $245 million was outstanding on the effective date. With the completion of its restructuring, Samson II has greater than $60 million in total liquidity (including both cash on hand and available under the credit facility).
Samson II is a privately held onshore exploration and production company headquartered in Tulsa, Oklahoma. The company has acreage positions in East Texas, the Powder River Basin and the Green River Basin that, taken together, comprise approximately 450,000 net acres and the company produces approximately 140 MMcfe/d of oil, natural gas, and NGLs. The company, in consultation with its new board and CEO, plans to conduct a strategic review of its asset portfolio and development plan in order to maximize value for its stakeholders.
In accordance with the plan, Samson II has appointed a new Board of Directors consisting of Matthew W. Bonanno, Partner at York Capital Management; Eugene I. Davis, chairman and CEO at Pirinate Consulting Group; Phillip A. Gayle, Jr., managing partner at Millennial Energy Partners; Joseph A. Mills, CEO of Samson Resources II LLC, and L. Spencer Wells, partner at Drivetrain Advisors. Eugene I. Davis will serve as chairman of the board.
Energy Players
In February, Upstream Exploration LLC, a privately-held independent oil and gas exploration and production company, named Louis Belanger as vice president of engineering. Belanger joined the company on January 1, 2017.
Belanger brings over 32 years of oil and gas experience to the company. Prior to joining Upstream, Belanger worked as an independent engineering consultant for numerous Gulf Coast companies, including Upstream. Prior to his work as a consultant, he was senior vice president of engineering at Goldking Onshore Operating, a senior reservoir engineer at Cimarex and director of acquisitions and reserves and economics at Energy Partners Ltd. Belanger earned a bachelor's degree in petroleum engineering from Louisiana State University and his MBA from Tulane University.
Metairie, Louisiana-based Upstream Exploration is focused on the exploration, exploitation, and development of oil and gas properties, primarily in the shallow waters of the Gulf of Mexico and along the US Gulf Coast.
