THE WOODLANDS, Texas, April 01, 2025 (GLOBE NEWSWIRE) — Ring Energy, Inc. (NYSE American: REI) announced that it has completed its previously-announced acquisition of the Central Basin Platform assets of Lime Rock Resources IV, LP on March 31, 2025. Lime Rock’s CBP operations are located in the Permian Basin in Andrews County, Texas, and are focused on the development of approximately 17,700 net acres where the majority are similar to Ring’s existing CBP assets in the Shafter Lake area, and the remaining acreage exposes the Company to new active plays.
KEY HIGHLIGHTS
- HIGHLY ACCRETIVE: 2,300 barrels of oil equivalent per day (“Boe/d”) (>80% oil) of low-decline net production from ~101 gross wells driving $34 million of 2025E Adjusted EBITDA1
- Accretive to key Ring per share financial and operating metrics, and attractively valued at <85% of Proved Developed (“PD”) PV-101,2
- INCREASED SCALE AND OPERATIONAL SYNERGIES: ~17,700 net acres (100% HBP) mostly contiguous to Ring’s existing footprint
- Expands legacy CBP footprint with seamless integration and identified cost reduction opportunities
- MEANINGFUL ADJUSTED FREE CASH FLOW (“AFCF”)1 GENERATION: Supported by $120 million of oil-weighted PD PV-101,2 reserves
- Higher AFCF, shallow decline and reduced reinvestment rate accelerates debt reduction
- STRENGTHENS HIGH-RETURN INVENTORY PORTFOLIO: >40 gross locations that immediately compete for capital
- Improves inventory of proven drilling locations with superior economics in active development areas
- CREATES A STRONGER AND MORE RESILIENT COMPANY
- Solidifies position as a leading conventional Permian consolidator while strengthening the operational and financial base
Mr. Paul D. McKinney, Chairman of the Board and Chief Executive Officer, commented, “We are pleased to announce the closing of our acquisition of Lime Rock’s CBP assets in the Permian Basin. The majority of these assets are similar to the conventional-focused CBP assets in our core Shafter Lake operations, which will allow us to quickly integrate the assets into our operations. The acquisition further consolidates assets in core counties in the CBP defined by shallow declines, high margin production and undeveloped inventory that immediately competes for capital, and provide for near-term opportunities for field level synergies and cost savings. As in the past, we will continue to execute our value focused proven strategy that we believe best positions the Company for long-term success.”
TRANSACTION CONSIDERATION
After taking into account preliminary purchase price adjustments, consideration for the Transaction consisted of:
- A cash payment of approximately $63.6 million net of the $5 million deposit payment made in February;
- $10.0 million deferred cash payment due on or about December 31, 2025; and
- The issuance of approximately 6.5 million shares of common stock.
The cash payment at closing was funded with cash on hand and borrowings under Ring’s senior revolving credit facility.
ADVISORS
Greenhill, a Mizuho affiliate, acted as sole financial advisor to Ring in connection with the acquisition and Jones & Keller, P.C. served as legal counsel. Truist Securities served as financial advisor to Lime Rock and Kirkland & Ellis LLP served as legal counsel.
ABOUT RING ENERGY, INC.
Ring Energy, Inc. is an oil and gas exploration, development, and production company with current operations focused on the development of its Permian Basin assets. For additional information, please visit www.ringenergy.com.
