Permian Resources (PR) Update - Feb 24

[dan_s]

Notes below are from Keith Kohl, a highly respected energy sector analyst that writes the monthly Energy Investor newsletter.

Recently, Permian Resources announced a series of strategic portfolio optimization
transactions to enhance its position and operations. This includes two bolt-on
acquisitions, a significant acreage swap, the divestiture of non-core assets, and more
than 140 additional grassroots acquisitions.

As part of their recent activities, Permian Resources acquired approximately 11,500
net leasehold acres and 4,000 net royalty acres in Eddy County, New Mexico for
around $175 million. These properties are primarily undeveloped, contiguous to the
legacy Earthstone’s position, and adjacent to Permian Resources’ Parkway asset, which
I’ll note is of their highest returning assets.

The plan now is for the company to begin development on this newly acquired
acreage later this year.

During the first quarter of 2024, Permian Resources executed an acreage trade
that further solidified its strategic position in Lea County, New Mexico. Permian
Resources traded into approximately 2,000 net acres with increased working interest
adjacent to its current position and traded out of approximately 2,000 net acres of
non-operated and lower working interest operated acreage. Development on the
newly acquired acreage is expected to commence in 2024.

Also during Q4 of 2023, we learned that Permian Resources completed the divestiture
of legacy Earthstone’s Eagle Ford assets for $67 million. This included approximately
1,000 barrels of oil equivalent per day of net production.

Throughout last year, Permian Resources has been actively high-grading its portfolio
through various transactions, adding approximately 17,000 Permian net acres, 7,300
Permian net royalty acres, and over 200 high-quality, gross operated locations in the
Delaware Basin core. These efforts have allowed the company to replace over 100% of
its developed inventory during 2023 for less than $100 million net of divestitures.

Permian Resources (NYSE: PR) is rated a “Buy” under $20.00