HOUSTON – Bracewell LLP is representing Sabalo Energy, LLC as part of an approximately $950 million transaction with Earthstone Energy, Inc., whereby Sabalo Holdings, LLC will contribute 100 percent of its interests in Sabalo Energy, LLC to Earthstone. Assets held by Sabalo Energy, LLC include both producing and non-producing oil and gas assets in the northern Midland Basin, which is part of the greater Permian Basin.
Sabalo Holdings, LLC entered into an agreement with Earthstone Energy, Inc., whereby Earthstone will acquire all of Sabalo Holdings’ interests in Sabalo Energy, LLC and Sabalo Energy, Inc. Sabalo Energy, LLC also entered into an agreement to acquire certain well-bore interests held by Shad Permian, LLC, which were part of a drilling joint venture between Sabalo and Shad. As a result of these agreements, Earthstone is expected to acquire 20,800 net acres located in the Midland Basin, an estimated 488 gross operated horizontal drilling locations and 349 gross non-operated horizontal drilling locations. The aggregate purchase price is approximately $950 million, which consists of $650 million in cash and $300 million in stock.
The acquisition is expected to close in late 2018 or in the first quarter of 2019, subject to the satisfaction of customary closing conditions, including the approval of Earthstone’s stockholders.
Sabalo is a privately held oil and gas company based in Corpus Christi, Texas, and is a portfolio company of EnCap Investments L.P.
For addition information on the agreement, please click here.
Bracewell lawyers involved in this transaction include:
Partners: W. James McAnelly III, Troy L. Harder, Elizabeth L. McGinley, Lance W. Behnke, Charles H. Still Jr., Austin T. Lee, Daniel E. Hemli and Scott C. Sanders
Senior Counsel: Steven J. Lorch
Counsel: Jacqueline R. Java
Associates: Hobie Temple, Kate B. McGregor, Molly E. Butkus, Shannon M. Rice, David Bartz, Catherine B. Engell and William A. Moss