Oklahoma Operator News: Alta Mesa's $3.8 Billion STACK Merger

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Silver Run II recently merged with Alta Mesa and Kingfisher Midstream to form a pure-play STACK company, Alta Mesa Resources, Inc. Darren Barbee, a senior Editor with Hart Energy published a great overview at Oil & Gas Investor (Click link for full article.)

Let's take a quick look at the land side of the merger and Alta Mesa's assets.

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Alta Mesa (operating under Oklahoma Energy Acquitions) primarily focuses on the eastern side of Kingfisher County, OK. This map shows where the company has acquired leases over the past few years (not including assignments). Source: Drillinginfo

 
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From January 1, 2017 to February 10, 2018, Oklahoma Energy Acquisitions has had 100 permits approved. As with their leasing, the permits are almost entirely located in Kingfisher County, OK.

The below chart illustrates Oklahoma Corporation Commission applications for the same time period. 

 
Source: Alta Mesa

Source: Alta Mesa

Alta Mesa likes to target the Oswego, Meramec and Osage Formations, where they lead the way in the number of STACK Wells operated by public companies, targeting these specific formations. 

 

Alta Mesa's current STACK Surface Acres covers 130,000 acres with a current production rate of 22,300 BOE/D. Alta Mesa has a $30 $/BBL WTI Breakeven price, with single-well IRR greater than 80%, positioning them as a low cost operator. 

Source: Alta Mesa   Alta Mesa's Investor Presentation has an in depth overview of Key 2017 Well Activity and metrics used for their reporting. If you are interested in diving deeper into the numbers, visit the investor portion of their site at  http://altamesa.net/

Source: Alta Mesa

Alta Mesa's Investor Presentation has an in depth overview of Key 2017 Well Activity and metrics used for their reporting. If you are interested in diving deeper into the numbers, visit the investor portion of their site at http://altamesa.net/

 

Alta Mesa Resources has an implied firm value of $3.8 Billion, at $10/share. As an earlier entrant into the STACK play (before it was named the STACK), Alta Mesa has been able to build their position over time and delineate and develop the region.

 
Source: Alta Mesa

Source: Alta Mesa

 
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Under the leadership of Hal Chappelle, Alta Mesa Resources is positioning itself for long term success in the world class STACK play. 

 

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