BCE-Mach III LLC recently signed a purchase and sale agreement to acquire producing properties in Western and Southern Oklahoma and the Texas Panhandle from Cimarex Energy. The acquisition, expected to close in June 2021, also includes two gas gathering and processing assets located in Southern Oklahoma.
BCE-Mach III LLC was formed in early 2020 and in April 2020 acquired the upstream and midstream assets from Alta Mesa Holdings, LP and Kingfisher Midstream, LLC, which are primarily located in Kingfisher County, Oklahoma. In total, Bayou City Energy Management LLC (“BCE”) and Mach Resources LLC (“Mach”) have made eight separate acquisitions since 2018 across the three BCE-Mach portfolio companies (collectively “BCE-Mach”).
BCE-Mach has assembled an expansive upstream portfolio of Anadarko Basin assets across 46 counties in Oklahoma, Kansas and the Texas Panhandle including interest in over 7,200 producing wells (over 3,100 operated producing wells), more than 700,000 net acres (96 percent held by production), and net production of ~48,000 boe/d (50 percent liquids). Additionally, BCE-Mach owns and operates an extensive infrastructure portfolio including two fully integrated water transfer and disposal systems (~700 miles of water pipelines and ~45 disposal wells), three gas gathering and processing systems (~310 MMcf/d processing capacity and ~450 miles of gathering lines), a ~85,000 HP compression fleet, and a crude gathering system (108 miles of pipeline and 50,000 bbl storage facility).
“We continue to have success adding to our holdings in the Mid-Continent region,” said CEO Tom Ward. “As a result of our scale in the area across our platforms, we are able to bolt on an acquisition of this size with minimal incremental overhead costs. In conjunction with our team’s expertise in the region and strong financial standing, we expect to extend our acquisition successes.”
“Our partnership with Mach has again resulted in owning more producing assets at attractive valuations,” said Will McMullen, BCE’s managing partner. “Generating free cash flow from our platform assets will continue as our overriding strategy. For 2021, we should exceed $200 million after accounting for all CAPEX, G&A, and debt interest expenditures, helping achieve a combined net debt to EBITDA multiple of a less than 0.25x. With this formidable financial strength, we will add to the Mid-Continent producing holdings and prudently develop the assets when appropriate. We will also evaluate applying this strategy to other basins where assets are either non-strategic to a seller or owned by unnatural holders.”