Callon Petroleum Co. (NYSE: CPE) said Oct. 24 it completed its Midland Basin bolt-on in Howard County, Texas.
The company agreed to pay ArcLight Capital’s Plymouth Petroleum LLC $340 million cash to buy certain producing properties and undeveloped acreage in its WildHorse operating area primarily in Howard. The deal included a "tag-along" sales rights with additional sellers.
The acquisition, which includes nearly 5,952 net surface acres and about 2,300 barrels of oil equivalent per day of current net production, is the Natchez, Miss.-based company's second Midland deal so far this year.
RELATED: Callon Strengthens Midland Core With $327 Million Acquisition
In June, Callon closed an acquisition of 17,298 gross (14,089 net) surface acres in Howard for about $301 million. The company also gained additional acreage elsewhere in the Midland in Martin, Borden and Dawson counties in Texas.
Callon's surface acreage position in the Midland Basin now totals more than 40,000 net acres, with roughly 20,000 net acres focused in Howard.
The company plans to quickly transition its WildHorse operations to support horizontal program with one rig dedicated to the area, said Fred Callon, the company's chairman and CEO.
"Following a completion in the Wolfcamp A zone with our Silver City A1H well immediately offsetting the acquired acreage, we recently commenced drilling two-well pads targeting both the Wolfcamp A and Lower Spraberry zones, and expect to place new wells from this development program on production in late 2016," Callon said in a statement.
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