Sabalo Energy II Secures Initial $300 Million Equity Commitment From EnCap Investments
CORPUS CHRISTI, Texas, Sept. 22, 2021 /PRNewswire/ -- Sabalo Energy II, LLC ("Sabalo") today announced the closing of a $300 million equity commitment from EnCap Investments L.P. ("EnCap"), a leading provider of growth capital to the independent sector of the U.S. energy industry.
Sabalo, led by President Barry K. Clark, is an upstream exploration and production company focused on the acquisition and development of large-scale unconventional oil and gas assets. The company's objective is to build, operate, and generate significant cash flow from a portfolio of upstream assets located in premier U.S. basins.
In its most recent partnership with EnCap, the Sabalo management team acquired over 21,000 net acres in the Midland Basin through a series of transactions and grew production to 14,500 Boe/d through a successful horizontal delineation and development program. On July 1st, 2021, Sabalo closed on the sale of its assets to Laredo Petroleum (NYSE: LPI) for $715 million of cash and stock consideration.
"Our team has a long history of value creation and excels at evaluating, building to scale, and successfully divesting large-scale asset packages in sought after development fairways," stated Barry Clark, President of Sabalo, "We look forward to continuing our partnership with EnCap and are excited about the opportunity set we see in the industry today. We believe the current macro environment presents an exciting opportunity for experienced management teams with strong financial backing to leverage the technological learnings of the past decade to generate strong stakeholder returns while pursuing a balanced ESG focus."
"EnCap is proud to continue our partnership with Barry Clark and the Sabalo team," said Brad Thielemann, EnCap Partner. "They have a demonstrable track record of capturing assets and creating value across various market environments. This equity commitment is a testament to our confidence in Sabalo's operational and technical ability to execute across multiple oil and gas basins."
Vinson & Elkins LLP served as legal counsel to EnCap and Bracewell LLP served as legal counsel to Sabalo on the formation of the new company.
About Sabalo Energy
Sabalo's strategy is to acquire, develop, and exploit oil and natural gas assets through the application of cutting-edge drilling, completion and production technology. The Company is actively evaluating acquisition opportunities in the major unconventional basins of the United States. For more information, please visit sabaloenergy.com.
About EnCap Investments L.P
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SOURCE Sabalo Energy
Company Codes: NYSE:LPI
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