Farmington driller buys remaining Energen acreage
FARMINGTON — Citing an ideal opportunity to expand its regional holdings, a newly reformed Farmington oil and gas company has purchased the entire remaining San Juan Basin assets of Birmingham, Ala.-based Energen Corp.
Julie Ryland, Energen spokeswoman, confirmed LOGOS Resources LLC bought the remaining 30 percent of the Energen's San Juan assets on July 14.
"The transaction has closed and Energen no longer has assets in the San Juan Basin," Ryland said. "The company is now a Permian Basin-focused oil and gas company."
Last year, Energen, which entered the San Juan Basin in the late 1990s, sold the other 70 percent of its San Juan assets to another entity, Ryland said. She declined to name the buyer of those assets.
Ryland also declined to name a price tag for the acreage sold to LOGOS.
However, Energen announced in a press release last month that it made $551.7 million for the sale of a portion of its assets in the Delaware Basin and the San Juan Basin assets purchased by LOGOS.
Net production with the sold acreage averages 9,000 oil-equivalent barrels per day, according to the release. The majority of that production comes from the San Juan assets, the release states.
Ryland said Energen's departure from the San Juan Basin was prompted after exploratory wells drilled in 2015 failed to match "high-quality" wells it owns in the Midland and Delaware Basins — sub-basins within the Permian Basin — in southeast New Mexico and southwest Texas.
LOGOS was founded in 2011 with a small acquisition in the San Juan Basin. In 2012, the company received $50 million in start-up funding from the Boston-based private investment company, ArcLight Capital Partners LLC.
By February 2014, ArcLight committed another $50 million, according to LOGOS President Jay Paul McWilliams, but the bulk of the driller's assets were sold by that fall while prices were still high.
Buying Energen's remaining San Juan acreage this month has breathed new life into the Farmington oil and gas company, McWilliams said.
He said the company was relaunched as LOGOS Resources II LLC, and now is headquartered in Energen's former Farmington offices on Afton Place. LOGOS employs 28 people, he said.
"This is a great time to acquire assets," McWilliams said.
McWilliams said LOGOS — which controls about 143,000 net acres with current production of natural gas at about 46 million cubic feet equivalent per day from about 550 wells — is focused on continuing to acquire and develop assets in the San Juan Basin. On an equivalent basis, LOGOS' assets are made up of about 52 percent natural gas and 48 percent crude oil and natural gas liquids, he said.
"Taking a long view, we're very committed to the San Juan Basin," he said. "It's our home, and though it's incredibly slow here right now, for us, we think there's a ton of opportunities looking forward."
James Fenton is the business editor of The Daily Times. He can be reached at 505-564-4621.