- Transaction drives value through significant synergistic opportunities and alignment with BKV's sustainability initiatives outlined in its 2021 report
- Midstream assets will add additional benefits across the energy value chain
BKV Corporation announced that its subsidiaries have closed on the purchase of natural gas upstream and associated midstream infrastructure in the Barnett Shale region of North Texas from XTO Energy, Inc., and Barnett Gathering LLC, subsidiaries of Exxon Mobil Corporation, for $750 million. Depending on future natural gas prices, additional contingent payments may be incurred along with typical closing adjustments.
Chris Kalnin, Chief Executive Officer of BKV, said, "We are excited to welcome approximately 130 new employees to our team, expand our footprint in the Barnett, and move one step closer towards the safe and profitable production of net-zero natural gas."BKV acquired approximately 160,000 total net acres in the Barnett, primarily Tarrant, Johnson and Parker counties, with upstream assets that include low decline wells, ideal for delivering consistent cash flow, and high average working interests of approximately 93 percent in over 2,100 wells with operatorship positions. The transaction also included approximately 750 miles of gathering pipelines, compression, and processing midstream infrastructure.
Upon closing, the company's total production and total reserves are approximately 900 MMcfe/d and 5.8 Tcfe, respectively. BKV has over 7,500 producing wells across 487,000 net acres, and its natural-gas-fueled power plant in Temple, Texas, produces a heat rate of 7,000 Btu/kWh at a capacity of 760 MW+.
Nick Kunze, BKV's Vice President of Operations in the Barnett, said, "We are excited to get started and build upon the strengths and legacy of the XTO team as we drive future growth in the Barnett. The extensive synergistic opportunities already in place allow us to hit the ground running, such as working toward certifying responsibly sourced gas (RSG) at the wellhead through a credible third party and offering additional access to premier Gulf Coast markets, just to name a few."
The purchase of the Barnett assets comes on the heels of the company's latest announcement about launching a dedicated carbon capture, utilization and sequestration (CCUS) business line with its first project anticipated to come online by the end of 2023.