Diamondback Energy Inc. (NASDAQ: FANG) continues to piece together acreage in the Midland Basin with a $538 million acquisition for 13,136 net acres--boosting its total position in the basin to more than 85,000 net acres.

In less than a year, Diamondback has accumulated an enviable position in the Midland and Permian basins through announced or completed deals worth $1.4 billion.

The Midland, Texas-based company announced July 21 it entered into a definitive purchase agreement for the acquisition with a group of unrelated sellers, including Rio Oil and Gas LLC, Bluestem Energy LP, B C Operating Inc., Crown Oil Partners V LP and Crump Energy Partners V LP. Rio Oil and Gas, Bluestem and Crump Energy are backed by private-equity firm Quantum Energy Partners.

The acquisition will provide Diamondback with mostly operated leasehold interests, the majority of which are located in Midland and western Glasscock counties, Texas.

The leasehold interests cover 16,773 gross (13,136 net) acres, 88% of which are operated. The acreage has net proved reserves of 5.2 million barrels of oil equivalent (MMboe) based on Diamondback's internal estimates as of June. During May, net production was about 2,173 boe/d from 131 gross (94 net) producing wells.

Horizontal development is expected to grow, with 396 gross (256 net) potential horizontal drilling locations identified. The company thinks the acreage is prospective for horizontal drilling in the Wolfcamp B, Lower Spraberry, Clearfork, Middle Spraberry, Wolfcamp A and Wolfcamp D (Cline) Formations.

Some of the acreage offsets the company's Gridiron well in Midland County, which appears to be among the best horizontal wells on a per-lateral foot basis in the Midland Basin, said Travis Stice, Diamondback's CEO, in a statement.

"I am very pleased about this acquisition because it offers a tremendous opportunity for the company to develop highly prospective acreage," Stice said. "Much of the value in these assets resides in the undeveloped acreage and, as a peer-leading developer of horizontal resources, we believe we can more cost-effectively convert this resource potential into cash flow."

The announced acquisition, expected to close in early September, follows several deals by Diamondback in 2013 and 2014.

In February 2014, Diamondback closed acquisitions of oil and natural gas interests from unrelated third-party sellers in Martin County for an aggregate price of $292.2 million. The transactions totaled 6,450 gross (4,785 net) acres with a 74% working interest (56% net revenue interest) and net production of about 2,200 boe/d (75% oil).

Diamondback said it thinks the acreage is prospective for horizontal drilling in the Wolfcamp B, Lower Spraberry, Middle Spraberry, Wolfcamp A, Cline and Clearfork horizons, and it has identified 42 potential horizontal drilling locations in each of the Wolfcamp B and Lower Spraberry horizons based on 160-acre spacing per well.

In September 2013, Diamondback completed two separate acquisitions of leasehold interests in the Permian from unrelated third-party sellers for a total of $165 million.

One closed on Sept. 4, 2013, when the company acquired assets in northwestern Martin County, Texas, consisting of a 100% working interest (80% net revenue interest) in 4,506 gross and net acres.

The second closed Sept. 26, 2013, when the company acquired certain assets located primarily in southwestern Dawson County, Texas, consisting of a 71% working interest (55% net revenue interest) in 9,390 gross (6,638 net) acres.

The acquisitions were funded with a portion of the net proceeds from an August 2013 equity offering.

On Sept. 19, 2013, the company completed a transaction for mineral interests underlying about 14,804 gross (12,687 net) acres in Midland County, Texas for $440 million. The mineral interests entitle the company to receive an average 21.4% royalty interest on all production from the acreage.