Vitol Group is buying Hunt Oil Co.’s Permian Basin business as the biggest independent crude trader makes a major move into the world’s busiest shale patch.
The deal includes 44,000 acres across five counties in the Midland Basin of West Texas with the equivalent daily output of about 40,000 barrels of oil a day, the company said in a statement on Friday. It’s the first acquisition for Vencer Energy LLC, the U.S. oil exploration unit formed by Vitol last year. While a purchase price was not disclosed, earlier in the week Hunt’s Permian assets were said to possibly command more than $1 billion, according to a person with knowledge of the matter.
America’s shale patch is seeing a divergence in activity as closely held explorers crank up drilling at a faster rate while their larger publicly-held counter parts look to mostly hold output flat this year to send juicier returns back to shareholders. The U.S. became a key export hub for the commodities trader after a ban on exporting crude was lifted in 2015 due to the relentless growth of shale production from the Permian and other basins.
“With this agreement in place, Hunt Oil Company looks forward to working with Vencer Energy towards a successful closing of this transaction in the coming months,” a Hunt spokesperson said by email.
Vitol, which handles about 7 million barrels of crude and fuels a day, has major upstream investments in Ghana, as well as smaller investments in Russia and former Soviet states including Azerbaijan, Kazakhstan and Ukraine. It’s also one of the biggest exporters of U.S. oil.
— With assistance by Andy Hoffman -Bloomberg
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