2023-08-14 06:51:25 ET
SilverBow Resources ( NYSE: SBOW ) said Monday it agreed to acquire Chesapeake Energy's ( NASDAQ: CHK ) oil and gas assets in south Texas for $700M, which Chesapeake said brings the total proceeds from its Eagle Ford exit to more than $3.5B .
The deal includes ~42K net acres and 540 wells in the condensate rich portion of the Eagle Ford located in Dimmit and Webb counties, which averaged net production of 29K boe/day in Q2.
SilverBow ( SBOW ) said it expects the deal will raise its Q4 net production to 87K-99K boe/day (~50% oil and natural gas liquids) and increase cash flow in 2024 by more than 80%, driving material accretion to both cash flow per share and free cash flow per share.
SilverBow ( SBOW ) said it will pay $650M at closing and $50M within one year of closing, plus an additional $25M contingent payment if WTI oil prices average $75-$80/bbl or $50M if prices average above $80 in the year following the close.
More on Chesapeake Energy:
- Financial and valuation comparison to sector peers
- Analysis: Chesapeake Energy: Natural Gas Pricing Presents An Opportunity
- Stock price return: Roughly flat YTD, down 7% in the past 12 months
For further details see:
Chesapeake sells remaining Eagle Ford assets to SilverBow in $700M deal