Acquisitions and Dispositions
|6 Months Ended|
Jun. 30, 2019
|Business Combinations [Abstract]|
|Acquisitions and Dispositions||Acquisitions and Dispositions
2019 Acquisitions and Dispositions
On June 12, 2019, the Company completed its divestiture of certain non-core assets in the southern Midland Basin (the “Ranger Asset Divestiture”) for net cash proceeds received at closing of $244,935, including customary purchase price adjustments. The transaction also provides for potential contingent consideration in payments of up to $60,000 based on West Texas Intermediate average annual pricing over a three-year period (see Notes 6 and 7 for additional information regarding the contingent consideration payments). The divestiture encompasses the Ranger operating area in the southern Midland Basin which includes approximately 9,850 net Wolfcamp acres with an average 66% working interest. The divestiture did not significantly alter the relationship between capitalized costs and proved reserves, and as such, net cash proceeds and contingent consideration were recorded as adjustments to our full cost pool with no gain or loss recognized.
In the first quarter of 2019, the Company completed various acquisitions and dispositions of additional working interests and acreage located in our existing core operating areas within the Permian Basin. The Company purchased mineral rights for $21,407 in the Spur operating area and received proceeds of $14,084, including customary purchase price adjustments, for certain leasehold interests in our WildHorse acreage. In the second quarter of 2019, the Company completed various acreage swaps in the Permian Basin and received proceeds of $19,108, including customary purchase price adjustments, for certain working interests in our Spur acreage.
On August 31, 2018, the Company completed the acquisition of approximately 28,000 net surface acres in the Spur operating area, located in the Delaware Basin, from Cimarex Energy Company, for $539,519, including customary purchase price adjustments (the “Delaware Asset Acquisition”). The Company issued debt and equity to fund, in part, the Delaware Asset Acquisition. See Notes 5 and 9 for additional information regarding the Company’s debt obligations and equity offerings. The following table summarizes the estimated acquisition date fair values of the acquisition:
In addition, the Company completed various acquisitions of additional working interests and mineral rights, and associated production volumes, in the Company’s existing core operating areas within the Permian Basin. In the first quarter of 2018, the Company completed acquisitions within Monarch and WildHorse operating areas for $37,770, including customary purchase price adjustments. In the fourth quarter of 2018, the Company completed acquisitions of leasehold interests and mineral rights within its WildHorse and Spur operating areas for $87,865, including customary purchase price adjustments.
The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef