STACK assets of bankrupt firms acquired by Mach Resources

For $320 million, Oklahoma City’s Mach Resources and its partner Bayou City Energy Partners have acquired assets from two bankrupt companies operating in Oklahoma’s STACK play.

The largest acquisition is the upstream oil and gas assets of Alta Mesa Holdings, LP. But Mach Resources also acquired the midstream assets of Kingfisher Midstream, LLC and its subsidiaries.

Both Alta Mesa Holdings and Kingfisher Midstream had earlier filed Chapter 11 bankruptcies.


The purchase agreements provide that BCE-Mach III will acquire approximately 30 Mboe/d of production (67 percent liquids), approximately 72 MMboe of proved reserves, more than 900 operated wells, and 130,000 net acres (90 percent HBP) from AMH as well as gas processing capacity of 350 MMcf/d, 453 miles of gas gathering pipeline, 157 Mbw/d produced water system capacity, 224 miles of water disposal pipeline, 108 miles of oil gathering pipeline and 50 Mbbl oil storage capacity from KFM for a combined purchase price of $320 million with a Jan. 1, 2020 effective date.

“This was a unique opportunity to acquire a sizeable cash-flowing asset with the supporting midstream infrastructure, through a bankruptcy process, in an area of our team’s expertise and still have an extensive inventory for future development,” said Mach CEO Tom L. Ward. “Our strategic aim in partnership with BCE has been to aggressively consolidate and maximize underdeveloped, undercapitalized or otherwise distressed areas in the Mid-Continent. We have been successful in buying assets at a discount, increasing production in a cost-effective manner and avoiding overspending. In a lot of ways, we have gone back to the fundamentals that were true when I began my career.”

“BCE is thrilled to be making another attractive acquisition in the Mid-Continent in conjunction with Mach Resources,” said BCE Founder and Managing Partner Will McMullen. “We know these particular assets well and are confident that the Mach team will be able to operate them in a manner suitable to the current macro environment, focused on maximizing free cash flow generation and delivering a sustainable, conservatively leveraged return to our investors. We continue to be encouraged by the opportunities we see to further consolidate assets in the Mid-Continent under the BCE-Mach banner.”

This acquisition represents the sixth acquisition by partnerships between BCE and Mach. To date, BCE-Mach LLC has made three acquisitions in the Mississippi Lime, and BCE-Mach II LLC has made two acquisitions in the Western Anadarko Basin. This acquisition of AMH and KFM represents the first acquisition in the newly formed BCE-Mach III LLC. Following closing, on a combined basis, the BCE-Mach partnerships will have net daily production of ~58 Mboe/d, interests in over 5,700 wells and ~500,000 net acres across the Mid-Continent.

Closing is expected to occur in February 2020 and is subject to customary conditions and purchase price adjustments. BCE-Mach III is being represented by Kirkland & Ellis LLP as legal advisor and UBS Securities LLC as financial advisor.

Source: Mach Resources announcement