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Civitas Grabs Bigger DJ Foothold with Takeover of Bison Oil
Denver-based Civitas Resources Inc., the largest oil and natural gas producer in the Denver-Julesburg (DJ) Basin, has added another trophy to its portfolio by snapping up Bison Oil & Gas II LLC in a cash-and-stock swap worth an estimated $346 million.
Once the transaction is completed, now expected by the end of March, the takeover would add 102 gross locations to the DJ-centered portfolio of Civitas, 38 sites of which are fully permitted. Pro forma, production would increase by 9,000 boe/d.
Bison private equity (PE) sponsor Carnelian Energy Capital, based in Houston, agreed to take 2.3 million shares of Civitas and $45 million cash. Civitas also is assuming $176 million of Bison’s debt.
“In just a short period of time, Civitas has established itself as a leading platform in the DJ Basin, with scale, resources and a demonstrated commitment to delivering unprecedented value to all of its stakeholders,” stated the management of PE giant Kimmeridge Energy Management Co. LLC, the second largest shareholder in Civitas.
Civitas, created last year from the combination of four DJ pure-plays, now controls more than half a million net acres in Colorado with a production base of 160,000 boe/d.
The formation of Civitas was overseen by Bonanza Creek Energy Inc. Then-CEO Eric Greager. In the first half of 2021, Greager helmed the takeover of crosstown DJ peer HighPoint Resources Corp. In May Bonanza agreed to buy Extraction Oil & Gas Inc., another DJ pure-play. One month later, the combination with Denver-based Crestone Peak Resources was announced.
Greager stepped down as CEO and president, effective Jan. 31. He agreed to serve as a technical consultant for the next year.
“It has been an honor and privilege serving as CEO of Civitas,” Greager said. He thanked the board and employees for “successfully shaping the company’s founding principles and positioning the platform for long term success.”
Civitas Chairman Ben Dell, who previously chaired Extraction, was named interim CEO. Dell founded Kimmeridge and is a managing partner. Kimmeridge has made investments in many other U.S. oil and gas projects including Callon Petroleum Co. and Desert Peak Minerals.
The board’s search committee is working to identify a new CEO.
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