Concho Resources Inc. Completes Acquisition of Midland Basin Assets
October 04 2016 - 4:30PM
Business Wire
Concho Resources Inc. (NYSE: CXO) (the “Company” or
“Concho”) today completed its previously announced acquisition of
approximately 40,000 net acres in the core of the Midland Basin
from Reliance Energy for approximately $1.625 billion. The acquired
assets, which are located in Andrews, Martin and Ector counties in
Texas, include production of 10 MBoepd, comprised of 67% crude oil.
Concho is currently running one rig on the acquired assets and
plans to add a second rig in early 2017.
Strong Financial Position
The Company recently completed its previously announced
redemption of the entire outstanding principal amount of $600
million of its 7.0% Senior Notes due January 2021 (the “Notes”).
The redemption price for the Notes was 103.5% of the principal
amount outstanding, which included the make-whole premium for the
early redemption of the Notes as determined in accordance with the
indenture governing the Notes. The Company also paid accrued and
unpaid interest on the Notes through September 19, 2016, the
redemption date.
Concho continues to reinforce its strong financial position. Pro
forma for the Notes redemption, closing of the previously announced
common stock offering and closing of the Reliance acquisition, the
Company had long-term debt of approximately $2.7 billion as of June
30, 2016, representing a $0.9 billion reduction in long-term debt
since June 30, 2015. Additionally, the Company’s pro forma
liquidity totaled approximately $2.5 billion as of June 30, 2016,
which reflects its undrawn revolving credit facility with total
capacity of $2.5 billion.
Concho Resources Inc.
Concho Resources Inc. is an independent oil and natural gas
company engaged in the acquisition, development, exploration and
production of oil and natural gas properties. The Company’s
operations are focused in the Permian Basin of southeast New Mexico
and west Texas. For more information, visit the Company’s website
at www.concho.com.
Forward-Looking Statements and Cautionary Statements
The foregoing contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. All statements, other
than statements of historical fact, included in this press release
that address activities, events or developments that the Company
expects, believes or anticipates will or may occur in the future
are forward-looking statements. Forward-looking statements
contained in this press release specifically include statements,
estimates and projections regarding the Company’s future financial
position, operations, performance, business strategy, oil and
natural gas reserves, drilling program, capital expenditure budget,
liquidity and capital resources, the timing and success of specific
projects, outcomes and effects of litigation, claims and disputes,
derivative activities and potential financing. The words
“estimate,” “project,” “predict,” “believe,” “expect,”
“anticipate,” “potential,” “could,” “may,” “foresee,” “plan,”
“goal” or other similar expressions that convey the uncertainty of
future events or outcomes are intended to identify forward-looking
statements, which generally are not historical in nature. However,
the absence of these words does not mean that the statements are
not forward-looking. These statements are based on certain
assumptions and analyses made by the Company based on management’s
experience, expectations and perception of historical trends,
current conditions, anticipated future developments and other
factors believed to be appropriate. Forward-looking statements are
not guarantees of performance. Although the Company believes the
expectations reflected in its forward-looking statements are
reasonable and are based on reasonable assumptions, no assurance
can be given that these assumptions are accurate or that any of
these expectations will be achieved (in full or at all) or will
prove to have been correct. Moreover, such statements are subject
to a number of assumptions, risks and uncertainties, many of which
are beyond the control of the Company, which may cause actual
results to differ materially from those implied or expressed by the
forward-looking statements. These include the risk factors
discussed or referenced in the Company’s most recent Annual Report
on Form 10-K and Quarterly Report on Form 10-Q for the quarter
ended June 30, 2016; risks relating to declines, or the sustained
depression of, prices the Company receives, for its oil and natural
gas; uncertainties about the estimated quantities of oil and
natural gas reserves; drilling and operating risks; the adequacy of
the Company’s capital resources and liquidity including, but not
limited to, access to additional borrowing capacity under its
credit facility; the effects of government regulation, permitting
and other legal requirements, including new legislation or
regulation of hydraulic fracturing and the export of oil and
natural gas; the impact of potential changes in the Company’s
credit ratings; environmental hazards, such as uncontrollable flows
of oil, natural gas, brine, well fluids, toxic gas or other
pollution into the environment, including groundwater
contamination; difficult and adverse conditions in the domestic and
global capital and credit markets; risks related to the
concentration of the Company’s operations in the Permian Basin of
southeast New Mexico and west Texas; disruptions to, capacity
constraints in or other limitations on the pipeline systems that
deliver the Company’s oil, natural gas liquids and natural gas and
other processing and transportation considerations; the costs and
availability of equipment, resources, services and qualified
personnel required to perform the Company’s drilling and operating
activities; potential financial losses or earnings reductions from
the Company’s commodity price risk-management program; risks and
liabilities associated with acquired properties or businesses,
including the Company’s acquisition of assets in the Midland Basin;
uncertainties about the Company’s ability to successfully execute
its business and financial plans and strategies; uncertainties
about the Company’s ability to replace reserves and economically
develop its current reserves; general economic and business
conditions, either internationally or domestically; competition in
the oil and natural gas industry; uncertainty concerning the
Company’s assumed or possible future results of operations; and
other important factors that could cause actual results to differ
materially from those projected.
Any forward-looking statement speaks only as of the date on
which such statement is made, and the Company undertakes no
obligation to correct or update any forward-looking statement,
whether as a result of new information, future events or otherwise,
except as required by applicable law.
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version on businesswire.com: http://www.businesswire.com/news/home/20161004006571/en/
Concho Resources Inc.Megan P. Hays,
432-685-2533Director of Investor RelationsorMary Tennant,
432-221-0477Senior Financial Analyst
Concho Resources (NYSE:CXO)
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