Earthstone signs US$1.5bn deal to buy Novo Oil & Gas

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Northern Oil and Gas, Inc. (NOG) announced that it has entered into a definitive agreement to acquire a 33.33% undivided stake in the Novo Assets in partnership with Earthstone Energy, Inc. 

The acquired assets encompass approximately 5,600 net acres, 7.2 net wells-in-process, 29.2 net producing wells, and 59.9 net undeveloped locations with low breakeven costs. These assets are predominantly located in Eddy County, New Mexico, and eastern Culberson County, Texas. Following the completion of the acquisition and the transition of services, Earthstone will become the operator of the majority of the assets. NOG, in accordance with cooperation and joint operating agreements established during the acquisition, will participate in the development process. Moreover, Earthstone and NOG have established an area of mutual interest, aimed at exploring opportunities for further consolidation of assets. This deal is subject to customary closing adjustments and is planned to close in August 2023. 

Truist Securities has been appointed as the financial advisor to Earthstone and NOG for the acquisition, while Kirkland & Ellis LLP is fulfilling the role of legal advisor. On the other hand, RBC Richardson Barr has been enlisted as the financial advisor for Novo, with Vinson & Elkins LLP serving as legal counsel. 

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