Benchmark Energy Acquires Oklahoma STACK Assets from SK Innovation
Privately-held E&P company Benchmark Energy LLC signed an agreement with various subsidiaries of South Korean energy and petrochemical group SK Innovation Co. Ltd. to acquire their oil & gas assets in the STACK play in the Anadarko basin in Oklahoma. The terms of the deal have not been disclosed.
The assets acquired include approximately 77,000 net acres located in the Nemaha and Plymouth fields in north-central Oklahoma. The acreage primarily targets the STACK play and the Mississippian formation within Grant, Garfield and Kingfisher counties. The acreage is 98% held-by-production, and around 87% of the wells will be operated by Benchmark in mature fields with strong cash flow and significant development potential from PDNP and PUD opportunities.
The assets also include an integrated gathering and saltwater disposal system, allowing for efficient field management. Production from the assets averaged approximately 3,600 net barrels of oil equivalent per day (boe/d) in January 2021, of which 60% was oil/liquids.
The transaction has been funded through a combination of debt and equity. Benchmark has entered into a Note Purchase Agreement with Cibolo Energy Partners LLC to issue a loan note of up to US$45 million to partially fund the acquisition. Benchmark’s existing owner, McArron Partners LP, provided the equity to fund the remainder of the deal consideration.
Pratt, Kansas-based Benchmark is engaged in the acquisition and production of conventional and unconventional oil and natural gas resources in western Oklahoma, with a primary focus on the STACK play.
SK Innovation operates worldwide in the field of energy, petrochemical, e-mobility battery, information electronic materials businesses, and oil & gas exploration & production through its 6 major subsidiaries, including SK Energy, SK Global Chemical, SK Lubricants, SK Incheon Petrochem, SK Trading International and SK IE Technology.