While it seems Aubrey McClendon's American Energy Partners LP has been busy building a position in the Utica at a level that is the largest in the industry, his Oklahoma City-based company is reported to be on the verge of making a deal estimated to be worth $2 billion in Texas, according to published reports.
Enduring Resources II LLC has been seeking a buyer for its Midland and Delaware basin holdings, Bloomberg first reported in early April. The company, financed by EnCap Investments LP, has assembled three blocks of acreage totaling nearly 125,000 gross acres in West Texas.Formed in 2011, Enduring, based in Denver, has four active project areas in Utah and Texas, including operations in the Permian Basin in West Texas. The company is working with Jefferies Group LLC to find potential suitors. The winning bidder was said to be American Energy Partners, according to a Reuters report on May 9.
Enduring is the second partnership between Houston-based buyout firm EnCap and energy industry veteran Barth Whitham, who started the first Enduring Resources in 2004 and sold its assets in 2010 to Cabot Oil & Gas Corp. (NYSE: COG), Statoil ASA (NYSE: STO) and Talisman Energy Inc. (NYSE: TLM) and O’BENCO II in three separate transactions.
A successful sale will add to the track record of Whitham, Enduring president and CEO. Whitman headed Westport Resources from 2001 to 2004, when it was sold to Kerr-McGee Corp. for $3.7 billion. In 2004, Enduring I was backed by $1 billion in capital from EnCap and other investors, and built up positions by drilling in five states before selling for $2 billion.
EnCap has invested in about 200 exploration and pipeline companies since it was founded in 1988, according to a presentation last year. It typically invests $200 million to $300 million in startup companies that it aims to sell in three to five years.
McClendon co-founded Chesapeake Energy Corp. (NYSE: CHK) in May 1989 and built it into one of the top drilling companies until his resignation in April 2013.
During his leadership, Chesapeake discovered the Haynesville Shale, Utica Shale, Powder River Niobrara Shale, Tonkawa Sand and Mississippi Lime unconventional plays.
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