Permian Basin producer Laredo Petroleum Inc. has revised its 2021 capital expenditure (capex) guidance upward following its acquisition of Sabalo Energy LLC’s assets in Howard County, TX, for roughly $715 million.

Laredo now expects capex to total $420 million from previous guidance of $360 million, management said Thursday in an update.

“As we integrate Sabalo’s operations, we have budgeted a moderate increase in activity and capital levels for the remainder of 2021, primarily driven by the drilling and completion of an eight-well package that was already in process at the closing of the transaction,” said CEO Jason Pigott. 

“We remain committed to a disciplined development pace and expect to return to operating two drilling rigs and one completions crew in early...