Diversified expands US upstream business further

London-listed Diversified Energy has partnered with asset management firm Oaktree Capital Management to acquire $419mn of oil and gas wells in Texas and Oklahoma, the company announced on October 7.

Diversified has entered into conditional agreements to buy the wells, along with field infrastructure, equipment and facilities, from Tapstone Energy and its partners. The assets currently produce around 12,000 barrels of oil equivalent/day, 80% of which is natural gas and NGLs.

The acquisition is Diversified's fourth in the region in the past five months and the third in which it has partnered with Oaktree. In May it acquired $135mn of upstream assets in Louisiana from Indigo Minerals, and went on to buy fields from Blackbeard Operating in July and Tanos Energy in August.

"With a net purchase price of less than two times net cash flow, this acquisition represents another highly accretive, fully balance sheet-financed acquisition that further demonstrates our status as a capable consolidator of producing assets within the Central region," Diversified CEO Rusty Hutson Jr said. "Our enlarged regional footprint strengthens our portfolio with additional high-quality assets and added scale to drive synergies."