Chord Energy to Acquire Williston Basin Assets From XTO Energy

Core Insights - Chord Energy Corporation (CHRD) will acquire Williston Basin assets from XTO Energy for $550 million in cash, enhancing its position in the shale basin [1][7] Acquisition Details - The transaction includes 48,000 net acres in the Williston Basin, with CHRD holding an 86% operated working interest and the acreage being 100% held by production [2] - The acquisition adds 90 net drilling sites, many overlapping with existing operations, allowing for long-lateral drilling to improve efficiency and reduce production costs [2] - The assets have a forecasted decline rate of approximately 23% [2] Production and Economics - The acquired assets are expected to contribute 9,000 barrels of oil equivalent per day, with 78% being oil [3] - Breakeven costs for the assets are in the $40 per barrel range, allowing for sustainable operations during low commodity price periods [3] - The transaction is expected to lower the overall breakeven cost for CHRD's asset portfolio [3] Financial Impact - The acquisition is anticipated to improve shareholder returns and be immediately accretive across key financial metrics [4] - The assets are expected to generate sustainable free cash flow, enhancing capital returns to shareholders [4] - CHRD plans to maintain a leverage ratio between 0.5x and 0.6x upon closing, with a goal to return to a 0.5x leverage ratio by 2026 [4] Shareholder Return Policy - CHRD returns approximately 50% of its adjusted free cash flow while maintaining leverage between 0.5x and 1.0x, and nearly 75% when leverage is below 0.5x [5] - In the third quarter, the company executed buybacks worth $83 million to reward shareholders [5]