Corporate M&A

Colgate Energy Acquires Luxe Energy

By Sakshi Jain
June 01, 2021
a minute read
Oil & Gas Rig

Colgate Energy Partners III LLC, a subsidiary of privately-held E&P company Colgate Energy LLC, has entered into a definitive agreement with Texas-based Luxe Energy LLC to acquire a majority of the assets owned by Luxe Energy in Texas in an all-stock transaction, for an undisclosed value.

Luxe Energy will continue to own and manage certain assets, including a portion of the non-operated leasehold interests that are operated by MDC Reeves Energy LLC and its affiliates.

Privately-held Luxe Energy’s assets include approximately 22,000 net acres of Permian basin properties located in Reeves and Ward Counties, Texas, with approximately 5,000 gross surface acres that support go-forward development, and a rig running in Ward County. The current average daily production attributable to the company is 17,000 barrels of oil equivalent per day (boe/d).

Pro-forma, the combined company formed as a result of this transaction will own approximately 57,000 net acres of Permian basin assets, and will have average daily production of around 45,000 boe/d.

“This acquisition is a perfect fit into the existing Colgate portfolio. The large contiguous acreage position sits right in Colgate’s backyard, and its Ward County position will compete for capital immediately. This transaction delivers the right balance of up-front production and cash flow to provide balance sheet strength, along with high-quality inventory to drive value over the coming years,” said Will Hickey, Co-CEO of Colgate Energy.

Headquartered in Midland, Texas, Colgate Energy is engaged in the acquisition, exploration, and development of oil and natural gas assets in the Delaware basin of Texas and New Mexico.

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