Markets
BP

BP's Unit Acquires San Juan Basin Assets from Devon Energy

An image of a pen on an open laptop
Credit: Shutterstock photo

U.K. supermajor BP plcBP announced that its U.S. Lower 48 Onshore oil and natural gas company has agreed to acquire all of Devon Energy Corp.'s DVN assets in the San Juan Basin in New Mexico and Colorado.

The U.S. onshore unit purchased interests in Devon's storied assets - the Northeast Blanco Unit ("NEBU") - in the San Juan Basin. The affiliate also bought a section of federal lands located in San Juan and Rio Arriba counties of New Mexico. The financial terms of the deal, however, were not disclosed.

BP's presence in the region dates back to the 1920s. With the transaction, BP would acquire interest in 480 producing wells spread over 33,000 gross acres by the first quarter of 2016, subject to necessary government agency approvals.

The transaction marks Houston-based Lower 48 Onshore oil and natural gas business's first major purchase in seven years and emphasizes its commitment to the San Juan Basin. The San Juan Basin ranks among the Lower 48's most prolific areas with a capacity to yield around 93,000 barrels of oil equivalent per day.

The latest agreement comes on the heels of Devon's decision to buy assets worth $2.5 billion in western Oklahoma and Wyoming.

Per a Devon video on the development of the NEBU, the company started work on the field while still a small enterprise with just two geologists, six engineers and four landmen. Though the company had initially used new techniques to produce coalbed methane in the NEBU, the attempts were not quite successful till 1988.

In 1998, Devon had a working interest of 23% and 18% net revenue interest in 33,000 acres in the NEBU. The unit, which was considered to be holding Devon's largest reserves, helped the company become one of New Mexico's top natural gas producers.

BP carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy sector are ReneSola Ltd. SOL and Boardwalk Pipeline Partners, LP BWP . Each of these stocks sports a Zacks Rank #1 (Strong Buy).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

BP PLC (BP): Free Stock Analysis Report

DEVON ENERGY (DVN): Free Stock Analysis Report

RENESOLA LT-ADR (SOL): Free Stock Analysis Report

BOARDWALK PIPLN (BWP): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

BP SOL DVN

Other Topics

Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More