Permian Basin

Matador Resources Co. has begun operations at the Black River cryogenic natural gas processing plant that it built in its Rustler Breaks prospect area in the Permian Basin’s Delaware sub-basin of Eddy County, NM. The plant has an inlet capacity of 60 MMcf/d, which is almost twice the size of the plant that Matador built in its Wolf prospect area and subsequently sold to an affiliate of EnLink Midstream LLC (see Shale Daily, Sept. 16, 2015). Matador has also placed in service a 12-inch diameter natural gas gathering line running throughout the length of its Rustler Breaks acreage.

Private equity giant Blackstone is going after the highly sought-after land in the Permian Basin, with $1.5 billion in initial commitments to back two experienced West Texas/New Mexico players.

Resolute Energy Corp. CEO Nicholas J. Sutton is retiring at the end of the year and is being succeeded by COO Richard F. Betz, the Denver-based exploration company said. Sutton is to continue “indefinitely” as executive chairman and remain “involved with material business and strategic matters.” Sutton has been chairman and CEO since Resolute was formed in 2004, creating one of the top Permian Basin players. He co-founded and ran HS Resources from 1987 until it was acquired in late 2001 by Kerr-McGee Corp. Betz, executive vice president and COO since March 2012, has been at Resolute since its inception. He also spent 17 years with Chase Securities Inc., an affiliate of the Chase Manhattan Bank, and its successor companies, where he was involved primarily in oil and gas corporate finance. Betz received a bachelor’s degree in finance from Villanova University and has a master’s degree from the Wharton School at the University of Pennsylvania.

Denver-based PDC Energy Inc. is joining the parade entering the Permian Basin, announcing Tuesday it would pay $1.5 billion to acquire two privately held operators that together would give it about 57,000 net acres in the Delaware sub-basin of West Texas.

The outlook for onshore U.S. exploration companies is becoming “incrementally positive” for 2017 and beyond, as supply/demand fundamentals correct and commodity prices begin to move higher, analysts with Raymond James & Associates Inc. are predicting.

Oil and natural gas industry costs have improved sharply since late 2014, but overall supply costs remain high, suggesting that it’s going to take stronger commodity prices to sustain global operations, BMO Capital Markets analysts said in a new report.

West Texas-focused Parsley Energy Inc. continued its Permian Basin spending spree on Monday, agreeing to pay $400 million for a bolt-on leasehold in the Midland sub-basin.

Permian Basin pure-play Concho Resources Inc. agreed Monday to pay $1.625 billion in cash and stock to Reliance Energy for 40,000 net acres in the Midland sub-basin.

Permian pure-play Callon Petroleum Co. is planning for growth as it looks ahead to 2017.