Vital Energy and Northern Oil and Gas to acquire Point Energy’s assets for $1.1 billion

Vital Energy, in partnership with Northern Oil and Gas (NOG), signed an agreement to acquire Point Energy’s assets in an all-cash transaction for a total consideration of US $1.1 billion. The transaction will significantly increase the company’s operational scale and footprint in the Delaware Basin and add high-value development inventory.

The agreement was signed in partnership with Northern Oil and Gas (NOG). Under the terms of the agreement, the two companies will acquire Point Energy’s assets in an all-cash transaction for total consideration of $1.1 billion.

Vital Energy agreed to acquire 80% of Point’s assets, with NOG acquiring the remaining 20%. The transaction is expected to close by the end of the third quarter of 2024 with an effective date of April 1, 2024, subject to customary closing conditions.

Closing price adjustments are expected to total approximately $75 million, reducing total consideration to approximately $1.025 billion. Vital Energy expects to fund its $820 million portion, net of expected purchase price adjustments, using its credit facility, which was recently expanded to $1.5 billion. Wells Fargo, National Association has committed to the increased elected commitment upon closing of the transaction.

"This bolt-on is a great fit for us, adding high-value inventory and production in the heart of our core operating areas. Furthermore, it expands our growing Delaware Basin position and balances our Permian operations. We expect to continue to demonstrate our ability to capture, integrate and create substantial value on acquired assets through optimised development plans, lower capital costs and proven operating practices, resulting in higher future cash flows," said Jason Pigott, President and Chief Executive Officer at Vital Energy.