Mach Resources acquires Alta Mesa's assets

Assets belonging to bankrupt players in Oklahoma's STACK play are being acquired for $320 million by Tom Ward's Mach Resources and its partner, Bayou City Energy Partners. In an announcement made Monday, Mach Resources said it and its partner have executed agreements to acquire s ubstantially all of Ward the upstream oil

and gas assets owned by Alta Mesa Holdings.

The partnership, BCE-Mach III LLC, also is acquiring midstream assets of Kingfisher Midstream LLC and its subsidiaries.

Both companies' assets are being offered through 363 sale processes associated with their bankruptcies.

“This was a unique opportunity to acquire a sizable cash-flowing asset with the supporting midstream infrastructure, through a bankruptcy process, in an area of our team's expertise,” Tom Ward, CEO of Mach Resources, stated as part of the release.

The assets, he added, also include an extensive inventory for future development.

The deal, expected to close sometime next month, provides the partnership with about 30,000 barrels of oil (equivalent) of daily production, with about 67% of that liquids.

The release stated Alta Mesa's holdings have about 72 million barrels equivalent of proved reserves, includes more than 900 operated wells and about 130,000 acres, of which about 90% is held by production.

Kingfisher Midstream assets it is acquiring include a natural gas processing capacity of 350 million cubic feet daily.

It also includes 453 miles of gas gathering pipeline, 157 thousand barrels per day of produced water system capacity, 224 miles of water disposal pipeline, 108 miles of oil gathering pipeline and 50,000 barrels of oil storage capacity.

Partnership beneficial

Officials stated this week their deals to acquire the Alta Mesa and Kingfisher Midstream represent the sixth major acquisition that Mach Resources and Bayou City Energy Partners have teamed up to make together under three distinct partnerships.

BCE-Mach LLC, the first, made three acquisitions in the Mississippi Lime. BCE-Mach II LLC made two more in the western Anadarko Basin. BCEMach III's first deal involves the one announced this week, officials said.

All together, the partnerships now control assets that produce about 58,000 barrels of oil equivalent daily from more than 5,700 wells that cover about 500,000 Mid-Continent acres.

“Bayou City Energy is thrilled to be making another attractive acquisition in the Mid-Continent i n conjunction with Mach Resources,” Will McMullen, its founder and managing partner, stated as part of the release.

“We know these particular assets well and are confident that the Mach team will be able to operate them in a manner suitable to the current macro environment, focused on maximizing free cash flow generation and delivering a sustainable, conservatively leveraged return to our investors.”

Ward, meanwhile, likened Mach's strategy to one he has come to know well over the span of his career. He founded Mach Resources in January 2017.

“Our strategic aim in partnership with Bayou City Energy has been to aggressively consolidate and maximize underdeveloped, undercapitalized or otherwise distressed areas in the MidContinent,” Ward said. “We have been successful in buying assets at a discount, increasing production in a cost-effective manner and avoiding overspending. In a lot of ways, we have gone back to the fundamentals that were true when I began my career.”