Riley Exploration Group LLC said May 26 it acquired a 90% equity interest in Cinco Resources Inc. (CRI) through a share exchange with private equity funds managed by Yorktown Energy Partners.

Riley, headquartered in Blanchard, Okla., also received an investment from funds managed by Yorktown to acquire a working interest in a new 25,000 acre horizontal oil play in the Permian Basin. The addition gives potential for some of the lowest finding and development costs in North America, the release said.

The Cinco acquisition and Yorktown’s investment will enhance Riley’s oil and gas asset portfolio, and provide Riley with high-quality growth opportunities in the Texas Gulf Coast and Permian Basin and the Oklahoma Arkoma Basin.

Riley’s CEO, Bobby Riley, said in a statement, "We have been working closely with Yorktown on a number of transactions that came together in the space of a few weeks, and resulted in our net production more than doubling, while our debt remained at zero. I believe this positions us well for substantial growth in the short and medium term and supports our goal of becoming a publicly-traded company by 2016."

Cinco, based in Dallas, has operations in the Eagle Ford Shale in South Texas, the Powder River Basin in Wyoming and the Woodford Shale in the Arkoma Basin of eastern Oklahoma.

Pro forma for the Cinco acquisition, Riley’s 2015 net production will increase to 1,600 barrels of oil equivalent per day.

Riley was advised by Petrides & Co. LLC of New York. The acquisition is effective May 19.