In Concho Resources Inc.’s (NYSE: CXO) fourth acquisition of the year, the Midland, Texas-based company said Nov. 21 that it agreed to buy 16,400 net northern Delaware Basin acres as the follow-up to its $1.6 billion Midland Basin deal in October.

The $430 million bolt-on acreage shores up the company’s leasehold position in the northern Delaware Basin, allowing for longer laterals.

About 10,000 net acres are located in the Red Hills area in Lea and Eddy counties, N.M. The seller was not disclosed.

The purchase price includes $150 million cash and 2.18 million shares of Concho common stock. At about $20,000 per acre, the leasehold compares well with recent Delaware transactions.

However, about 6,400 acres in northern Eddy County was likely valued at about $8,500 per acre based on recent comparables, such as the Yates Petroleum sale, said David Deckelbaum, an analyst at KeyBanc Capital Markets.

“We see CXO paying about $29,00/ acre for core Red Hills acreage, which still comps well, vs. the $43,000 per acre that RSP Permian paid for Silver Hill,” he said.

While the acreage is a combination of federal and state acreage, it is unlikely to be hindered by oversight agencies.

“Since some of this acreage is on federal lands, we believe the recent Trump election reduces the risk that federal permits could be slow-walked,” said Pearce Hammond, senior research analyst at Piper Jaffray & Co.

The deal expands Concho’s Red Hills area by more than 25% to 47,000 net acres. That’s a potential bright spot for Concho, which highlighted strong well results from the Upper Wolfcamp sand during its third-quarter 2016 earnings report.

The Red Hills area features 5,000 ft of resource-rich hydrocarbon column, making the area highly prospective for multizone development, Concho said.

“This is a smart acquisition for CXO as it increases their exposure to a core area,” Hammond said.

The acquisition doubles the company’s long-lateral inventory in the Red Hills

Concho said it would increase its 2017 total production growth target by 18% to 21% while maintaining capex at $1.5 billion at the midpoint.

Tim Leach, Concho’s chairman, CEO and president, said the transaction is an opportunistic bolt-on where the company is delivering strong well performance.

“Our evaluation provides for multiple opportunities to enhance value through increased density development on multiwell pads as well as additional zones beyond the Avalon Shale, Wolfcamp Shale and the emerging Wolfcamp Sands,” Leach said. “With a continued focus on driving capital efficiency gains and actively managing our portfolio, this acquisition further strengthens our industry-leading position in the Permian Basin and reinforces our ability to deliver differentiated long-term growth.”

Since January, Concho has made transactions valued at $2.5 billion, including its most recent Delaware purchase.

Darren Barbee can be reached at dbarbee@hartenergy.com.