Crescent Energy Ascends in Eagle Ford

---

Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Acreage in the Eagle Ford shale basin acquired from Ridgemar Energy (Houston, Texas) for nearly $1 billion could yield as much as 20,000 barrels of oil equivalent production, Crescent Energy (Houston) said.

Crescent signed a definitive agreement to pay more than $900 million for Eagle Ford acreage. The company said it builds on a steady string of acquisitions in the basin over the past 18 months that totaled more than $4 billion.

"These assets contribute meaningful scale, enhance Crescent's cash margins, increase our oil-weighting and extend our low-risk inventory life, all at an attractive and highly accretive valuation," said David Rockecharlie, the chief executive officer of Crescent, on Tuesday. "I remain confident in our ability to capitalize on our strong momentum and continue our profitable growth trajectory toward our investment-grade ambitions."

The company believes the acreage could yield as much as 20,000 barrels of oil equivalent per day (Boe/d), coupled with about 140 wells in high-return locations.

Riding the wave of mergers and acquisitions this year, Crescent in May announced plans to acquire SilverBow Resources for $2.1 billion, creating what it believed was the second-largest operator in the Eagle Ford in the process.

SilverBow last year put up $700 million to take 42,000 net acres in the Eagle Ford from Chesapeake Energy, now known as Expand Energy Corporation (NASDAQ:EXE) (Oklahoma City, Oklahoma). SilverBow said at the time the deal made it the "largest public pure-play" operator in the Eagle Ford.

Through "multiple transactions," SilverBow managed to assemble about 250,000 net acres in Eagle Ford over the last three years.

Eagle Ford is among the lower-producing shale basins in the country, but those basins are evolving. Pressure variances in wells over time can lead to more natural gas. Though Eagle Ford is the second-lowest gas producer, the federal government expects it to be one of the largest contributors to future growth.

The Energy Information Administration, the statistical arm of the U.S. Department of Energy, expects natural gas production to increase 1% from this year's average to reach 114 billion cubic feet per day (Bcf/d) in 2025. Much of that growth stems from the expected 5% increase in gas production from Eagle Ford.

Declines, meanwhile, are expected in the Appalachia Basin, the largest inland gas producer in the U.S.

In terms of oil, Eagle Ford accounts for just more than 1% of the total inland production of about 11 million barrels of oil per day (BBL/d).

Crescent during the third quarter reported production averaged 219,000 Boe/d, with nearly 60% of that as natural gas. Bucking trends in the energy sector, Crescent recorded about $750,000 in net revenue, a 16% increase from second-quarter levels.

"Crescent's third-quarter results reflect continued execution on our business objectives of growing profitably through acquisitions while capturing additional value from our current assets," Rockecharlie said at the time.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).