Midland’s Charger Shale Oil Co. LLC has teamed with Oaktree Capital Management LP to form a joint venture (JV) focused in the Permian Basin, the companies said Sept. 8.
Oaktree pledged $600 million in an initial equity commitment with another $300 million runway commitment.
Prior to the JV, Charger said it secured more than 40,000 Delaware Basin acres with funds from management and other investors.
Charger has closed on the initial acreage and the company has development plans to expand to more than 85,000 acres. At full development, the partnership plans to target more than 100 horizontal well locations across multiple horizons.
Charger is led by several key executives previously employed by Tall City Exploration, which acquired and developed more than 34,500 core acres and another 48,000 prospective acres with $245 million of capital. The assets sold in two transactions in 2014 and 2015 for a combined $1.2 billion.
Joseph Magoto, president of Charger and former president of Tall City, was involved in the development and sale of Tall City’s assets. Under Magoto’s guidance, Charger intends to employ former Tall City executives.
“Leveraging the experiences of the team from Tall City Exploration and our other notable staff members has helped jump-start our company, allowing us to immediately acquire significant acreage and commence drilling this month. We plan to run two rigs one month after the company’s official funding,” Magoto said. “Oaktree’s funding represents an exciting step forward in our goal to build an enterprise in excess of 100,000 acres and to drill sufficient horizontal wells to prove up some 1,500 locations.”
Charger utilized the investment banking services of Jefferies in the transaction.
Oaktree is a global investment manager specializing in alternative investments. The firm has $98 billion in assets under management as of June 30. It is based in Los Angeles.
Darren Barbee can be reached at dbarbee@hartenergy.com.
Recommended Reading
Deep Well Services, CNX Launch JV AutoSep Technologies
2024-04-25 - AutoSep Technologies, a joint venture between Deep Well Services and CNX Resources, will provide automated conventional flowback operations to the oil and gas industry.
EQT Sees Clear Path to $5B in Potential Divestments
2024-04-24 - EQT Corp. executives said that an April deal with Equinor has been a catalyst for talks with potential buyers as the company looks to shed debt for its Equitrans Midstream acquisition.
Matador Hoards Dry Powder for Potential M&A, Adds Delaware Acreage
2024-04-24 - Delaware-focused E&P Matador Resources is growing oil production, expanding midstream capacity, keeping debt low and hunting for M&A opportunities.
TotalEnergies, Vanguard Renewables Form RNG JV in US
2024-04-24 - Total Energies and Vanguard Renewable’s equally owned joint venture initially aims to advance 10 RNG projects into construction during the next 12 months.
Ithaca Energy to Buy Eni's UK Assets in $938MM North Sea Deal
2024-04-23 - Eni, one of Italy's biggest energy companies, will transfer its U.K. business in exchange for 38.5% of Ithaca's share capital, while the existing Ithaca Energy shareholders will own the remaining 61.5% of the combined group.