FORT WORTH, Texas, April 24, 2017 /PRNewswire/ -- Kimbell Royalty Partners, LP (NYSE: KRP), a leading owner of oil and natural gas mineral and royalty interests across twenty states, today announced the closing of the acquisition of 1.1 million gross acres (6,700 net royalty acres) of overriding royalty interests in the Anadarko Basin from Maxus Energy Corporation for $15.9 million. This acquisition primarily includes assets located in the panhandle of Texas and Northwest portion of Oklahoma.
This diversified package, which is substantially all held by production, includes production from multiple stacked pay zones in over 2,600 producing wells located across 32 counties in five states throughout the Mid-Continent, including Texas, Oklahoma, Louisiana, Wyoming and New Mexico. A total of 145 wells have been drilled on the acquired interest since 2014. Management has estimated the average daily production is approximately 272 net Boe/d (6:1) for the first quarter of 2017 and total proved reserves are 1,873 MBoe (6:1) as of April 1, 2017, which consists of 74% natural gas, 16% natural gas liquids and 10% oil. The transaction was funded through the Partnership's credit facility.
Commenting on the transaction, Bob Ravnaas, Chairman and CEO of Kimbell Royalty Partners, said, "The completion of this acquisition from a seller in a bankruptcy for acreage in the active Anadarko Basin demonstrates our opportunistic and disciplined approach to growth. One of our primary objectives has been to acquire high quality, producing acreage with significant amounts of recoverable oil and gas, a complementary geographic footprint and long-life and shallow decline expectations. In addition, current production rates in the Anadarko Basin are expected to rise through increased rig activity due to an expanding infrastructure and technological advancements. Furthermore, from a valuation and operational standpoint, the transaction is expected to be accretive to KRP on enterprise value/net production, enterprise value/net acreage and cash flow per unit basis. We believe this acreage is well positioned for continued growth and is an excellent asset base to add to our portfolio."
Kimbell Royalty Partners, LP
Kimbell Royalty Partners, LP (NYSE: KRP) is an oil and gas mineral and royalty variable rate master limited partnership based in Fort Worth, Texas. KRP is managed by its general partner, Kimbell Royalty GP, LLC, and owns mineral and royalty interests in approximately 4.5 million gross acres in twenty states and in nearly every major onshore basin in the continental United States, including ownership in more than 48,000 gross producing wells with over 29,000 wells in the Permian Basin.
This news release includes forward-looking statements. These forward-looking statements involve risks and uncertainties, including risks relating our business and the securities markets generally. Except as required by law, Kimbell Royalty Partners, LP undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this news release. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in our filings with the Securities and Exchange Commission. These include risks inherent in oil and natural gas drilling and production activities, including risks with respect to continued low or further declining prices for oil and natural gas that could result in downward revisions to the value of proved reserves or otherwise cause Kimbell to delay or suspend planned drilling and completion operations or reduce production levels, which would adversely impact cash flow; risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in oil and natural gas prices; risks regarding Kimbell's ability to meet financial covenants under its credit agreements or the ability to obtain amendments or waivers to effect such compliance; risks of fire, explosion, blowouts, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; delays in receipt of drilling permits; risks relating to unexpected adverse developments in the status of properties; borrowing base redeterminations by Kimbell's banks; risks relating to the absence or delay in receipt of government approvals or third-party consents; risks relating to Kimbell's ability to realize the anticipated benefits from acquired assets; and other risks described in Kimbell's Annual Report on Form 10-K and other filings with the Securities and Exchange Commission, available at the SEC's website at www.sec.gov. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this news release.
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SOURCE Kimbell Royalty Partners, LP