RSP Permian Inc. (NYSE: RSPP) entered into definitive agreements to acquire some undeveloped oil and gas producing acreage in Glasscock County, Texas, the company said July 25.

For the northern Midland Basin acreage, RSP Permian paid about $259 million in cash to “multiple sellers” in “separate transactions,” the company said.There are 7,680 gross (6,652 net) surface acres, or 21,440 gross (19,397 net) horizontal acres, RSP Permian said. These acres have 188 gross (156 net) horizontal drilling locations and 158 gross (132 net) vertical drilling locations on both 20-acre and 40-acre spacing.

Currently, about 1,106 barrels of oil equivalent (boe) is produced, about 74% of it liquids, the company said. RSP Permian will operate the acreage, and will have an average working interest of about 87%, the company said.

There are about 22 MMboe, 9% developed, of net proved reserves, and more than 125 MMboe of resource potential, the company added.

"Our experience and strong relationships in the Permian Basin enabled RSP to successfully negotiate the acquisition of these assets in the core of the Midland Basin from multiple parties. The acquisitions are a significant bolt-on to our existing Glasscock leasehold acreage position which was acquired in the first quarter of this year and we expect them to be accretive to cash flow per share and earnings per share as well as net asset value," said CEO Steve Gray.

"The value of these acquisitions was principally in the undeveloped acreage as these assets have multiple horizontal targets and come with ample vertical inventory that will provide years of potential horizontal and vertical growth for the company. With these transactions, we have meaningfully increased our drilling inventory in what we believe to be a top tier area in the Midland Basin," he said.

One vertical rig is developing the acreage now, but RSP will begin an additional horizontal drilling program there in 2015, the company said. Its “target horizons” include the Lower Spraberry, Wolfcamp A, Wolfcamp B and Wolfcamp D (Cline) Formations, the company said, noting that other stacked-pay zones have potential.

The acquisitions are scheduled to close in August, the company said. They will be funded through revolving credit facility borrowings and “potential equity market transactions,” RSP Permian said.

Dallas-based RSP Permian Inc. acquires, explores, develops and produces unconventional oil and natural gas in the West Texas Permian Basin.