Matador Expands Delaware Basin Footprint with $1.28 Billion Acquisition of 16,000 Acres

Matador Resources has reached an agreement to acquire Permian basin operator Paloma Permian LLC from EnCap Investments for $1.275 billion in cash. This acquisition includes 16,235 net undeveloped acres in Lea and Eddy counties, New Mexico, alongside producing properties projected to average 11,100 barrels of oil equivalent per day (57% oil) in the third quarter of 2026. The deal also includes approximately 55 million barrels of oil equivalent in proved reserves and over 156 net drilling locations in the Wolfcamp and Bone Spring formations. The transaction is projected to close in the fourth quarter.

In a separate transaction, Matador is acquiring mostly undeveloped acreage from Ridge Runner Resources II, another EnCap portfolio company, to grow its Woodford formation footprint in southeast New Mexico and West Texas. This acquisition, combined with previous transactions, expands Matador’s Woodford holdings to roughly 50,000 contiguous net acres and increases its total Delaware basin position to approximately 240,000 net acres.

This expansion follows Matador’s successful validation of the Woodford play in New Mexico. The company’s Rae’s Creek exploratory well achieved an initial 24-hour production rate exceeding 2,200 barrels of oil equivalent per day, with oil representing 72% of the total. On a 60-day cumulative oil production basis, the well has outperformed the average Texas Woodford well by about 20%, demonstrating the commercial viability of the play in this area of the Delaware basin.

According to Matador, the Ridge Runner acquisition provides over 150 operated Woodford drilling locations and offers opportunities for longer laterals, larger development programs, and increased operational efficiencies. The company anticipates these efficiencies could lower well costs by 30% to 40% over the next 12 to 18 months.

Joseph Wm. Foran, Matador’s founder, chairman, and CEO, expressed excitement over the asset expansion and noted that the Rae’s Creek well results confirm the commercial potential of the Woodford formation in southeast New Mexico, paving the way for future development.

These transactions align with Matador’s ongoing strategy to grow its operated footprint in the core Delaware basin and increase its exposure to emerging unconventional plays in the Woodford formation.