Jagged Peak considering new acquisitions in Permian
NEW YORK and HOUSTON (Bloomberg) -- Jagged Peak Energy is considering expanding its footprint in the oil-rich Permian basin of West Texas and New Mexico, according to people with knowledge of the matter.
The oil and gas company, with a market value of $2.2 billion, is working with an adviser to pursue bolt-on acquisitions, said the people, who asked not to be identified because they weren’t authorized to speak publicly. Jagged Peak has several potential targets in mind, the people said.
Jagged Peak’s largest shareholder is the private equity firm Quantum Energy Partners, which started the company in 2013 with a $400 million investment. It now owns 69% of Jagged Peak’s shares, according to data compiled by Bloomberg.
Denver-based Jagged Peak operates entirely in the Permian, with its acreage located in the southern portion of the region’s Delaware Basin.
A spokesman for Jagged Peak declined to comment.
North American energy explorers and producers in the booming Permian are facing pipeline bottlenecks that have pushed crude prices lower, spurring some to consolidate. In November, Cimarex Energy announced a $1.6 billion deal including debt to buy peer Resolute Energy, while Endeavor Energy Resources has received interest from multiple potential bidders including Chevron and Exxon Mobil.
Jagged Peak is seeking partners for its Big Tex acreage in Pecos County, Texas. Jagged Peak Chief Executive Officer James Kleckner said on a call last month that the company hopes to have “clarity on that arrangement ahead of year-end.” If the company fails to reach a final deal, Jagged Peak’s capital budget will remain “flexible,” he said.
Jagged Peak went public in January 2017, raising $474 million at $15 a share, falling short of its $650 million target, according to data compiled by Bloomberg. Shares are down about 38% since a high this year of $16.31 in January. Jagged Peak rose 1.4% to $10.15 in New York on Wednesday.
