Silverbow Increase Eagleford Footprint , Chesapeake Exits

Transaction Details: 

SilverBow Resources said today that it is acquring  Chesapeake Energy oil and gas assets in South Texas for a purchase price of $700 million, comprised of a $650 million upfront cash payment due at closing and an additional $50 million deferred cash payment due 12 months post close, subject to customary adjustments.

 Chesapeake may also receive up to $50 million in additional contingent cash consideration based on future commodity prices.

Transaction Summary

Purcahse Price : $700m

Land : 42,000 net acres

Production : ~32mboe/d (60% oil/NGLs)

Locations : 300

$850 million of Proved Developed Producing (“PDP”) PV-10

As of December 31,
2022, net proved reserves associated with these properties were approximately 124 million barrels of oil equivalent (mmboe

Attractively valued at 2.3x NTM EBITDA¹ with a >20% unlevered free cash flow yield

CHESAPEAKE SOUTH TEXAS ASSET HIGHLIGHTS

• Adds ~42,000 net acres in Dimmit and Webb counties across the highly prolific, liquids-heavy window of South Texas
• Expected production of ~31,000-33,000 Boe/d (~60% oil/NGLs) for the fourth quarter of 2023
• ~$850 million of Proved Developed Producing (“PDP”) PV-10 reserves value² compared to the $700 million purchase price
• ~300 additional high-confidence drilling locations across the Austin Chalk and Eagle Ford formations which immediately compete for capital

CHESAPEAKE SOUTH TEXAS ASSET HIGHLIGHTS

Adds ~42,000 net acres in Dimmit and Webb counties across the highly prolific, liquids-heavy window of South Texas

Expected production of ~31,000-33,000 Boe/d (~60% oil/NGLs) for the fourth quarter of 2023
~$850 million of Proved Developed Producing (“PDP”) PV-10 reserves value2 compared to the $700 million purchase price

~300 additional high-confidence drilling locations across the Austin Chalk and Eagle Ford formations which immediately compete for capital