Texas E&P company expands Permian acreage for $45.6 million

By Patrick C. Miller | October 12, 2017

Lilis Energy Inc. has entered into an agreement to acquire more than 4,000 net contiguous and overlapping acres in the Permian Basin from a private seller for approximately $45.6 million in cash.

The acquisition increases the San Antonio-based exploration and production company’s acreage position in the Delaware Basin to more than 15,000 net acres, exceeding its year-end 2017 acreage guidance. The transaction is expected to close in November 2017.

"We are extremely pleased with this acreage acquisition transaction,” said Ron Ormand, executive chairman of Lilis Energy. “This acquisition is not only contiguous and overlapping to our existing core properties, but also increases our overall working interest and operatorship.”

According to Lilis Energy, the acreage position is conducive for long-lateral development in multiple stacked pay zones. The acquisition adds more than 150 net potential locations to the company’s inventory.

The company also provided production results for a well drilled in its Wildhog BWX State Com lease—Lilis Energy’s fifth successful operated horizontal Wolfcamp B well in the Delaware Basin. Online for 47 days, the well is producing at 72 percent oil and 86 percent liquids on a three-stream basis. The Wildhog well’s 4,567-foot treated lateral was completed using 23 stages of 200-foot plug-to-plug spacing and 1,837 pounds of sand per foot, consistent with the company’s completion designs.

Lilis Energy reported that the Wildhog well reached a 24-hour initial production rate of 997 barrels of oil equivalent per day (boepd), which equates to 219 boepd per 1,000 feet and a rate of 188 barrels of oil per day per (bopd) 1,000 feet respectively. The well’s 24-IP rate per 1,000-foot lateral exceeds the average surrounding offset Delaware Basin activity on both a boepd and bopd basis.

“The results from the Wildhog provide further evidence of the significant productivity and potential of our eastern acreage," Ormand said.