Diamondback Energy to acquire Permian's Double Eagle for $4.1 billion

Diamondback Energy has entered into a definitive agreement to acquire Double Eagle, significantly expanding its acreage and presence in the Permian basin. The deal holds a value of approximately $4.08 billion, with Diamondback offering up 6.9 million shares of common stock and $3 billion cash in exchange for Double Eagle's assets.

Diamondback also announced plans to sell $1.5 billion of non-core assets to accelerate pro forma debt reduction in order to maintain its strong balance sheet.

“Double Eagle is the most attractive asset remaining in the Midland basin,” stated Travis Stice, Chairman and Chief Executive Officer of Diamondback. “With 407 locations adjacent to our core position, this largely undeveloped asset adds high-quality inventory that immediately competes for capital. Additionally, we see value uplift to our existing inventory as acreage overlap allows for meaningful lateral length extensions and infrastructure synergies. We look forward to seamlessly implementing our industry leading cost and operational structure on this differentiated asset.”

“The Permian basin continues to consolidate rapidly. We have worked tirelessly over the last thirteen years to position Diamondback to have the longest duration of high quality, low-breakeven inventory; a position we are solidifying with today’s announcement,” added Stice.

“We are excited to announce our agreement with Diamondback,” Cody Campbell and John Sellers, Co-CEOs of Double Eagle, commented. “We believe our team has built a truly standout asset that further increases Diamondback’s high-quality inventory. It was important to us that we maintain the stewardship of this asset going forward not only with a world-class Midland operator but also a group that shares our core values and understands the importance of community impact in West Texas.”

As part of this agreement, Diamondback and Double Eagle have also agreed to accelerate development on a portion of Diamondback’s non-core southern Midland basin acreage. This acceleration is expected to bring forward Net Asset Value (“NAV”) to Diamondback by developing Diamondback’s lower quality acreage at a faster pace than current expectations. As a result, Diamondback expects significant Free Cash Flow growth in 2026 and beyond with minimal capital deployment through this accelerated development plan.

Asset Highlights: Consolidated Scale in the Midland Basin

• Approximately 40,000 net acres in the core of the Midland Basin
• Estimated run-rate production of approximately 27 MBo/d (69% oil)
• $200 million of capital expenditures anticipated in 2025 at current Midland basin well costs of $555 to $605 per foot
• Extends pro forma inventory life in the core of the Midland basin
• 68% of the asset is undeveloped with 407 estimated gross (342 net) horizontal locations in primary development targets with an average lateral length of approximately >11,000’
• 44 gross upside locations primarily located in emerging zones
  
  

Diamondback expects the transaction to close on April 1, 2025, subject to customary closing conditions and regulatory approval.