U.S. Energy Development Corp. Expands Footprint in Permian Basin With $225M Investment

U.S. Energy Development Corp., an Arlington-based exploration and production company. They acquired a 25% working interest in the Mascot Project. It is stacked pay asset in core Midland Basin for $225 million cash and other considerations, the company announced.

U.S. Energy said it anticipates full development of the project to comprise another $130 million in capital expenditures. This is over the next two years. It will be bringing the total transaction value to more than $300 million.

The majority owner has a strong track record

Located in Midland County, the Mascot Project includes multiple producing properties, associated midstream assets, and upwards of 50 undeveloped locations expected to produce roughly 6,500 BOE per day during 2023.

The Mascot Project is majority-owned by Midland Petro D.C. Partners LLC, a David H. Arrington-owned business, and operated by an affiliate of MPDC, Permian Deep Rock Oil Co.

“Mr. Arrington has decades of experience operating quality projects in the basin, and we are pleased to partner with him in bringing this asset to full development,” Jayson said.

Including the Mascot Project, U.S. Energy said it has overseen the investment of $575 million over the past 24 months, focusing primarily on near-term drilling opportunities and actively producing assets.

Building a bigger footprint U.S. Energy Development Corp in the Permian Basin

In late 2022, U.S. Energy announced a planned allocation of up to two-thirds of its operating budget for projects in the Permian Basin over the next two to three years, totaling $200-$300 million annually.

The company said this deal will build upon its sizable footprint in the basin, expanding upon recent investments of over $400 million during the past 12 months. The firm said it anticipates operating a one- to two-rig program in the basin during the second half of 2023 and carrying this program into 2024.

In an article on World Oil earlier this month, Jayson wrote, “the impressive hydrocarbon output is the primary reason that U.S. Energy Development Corp places a substantial amount of our investment, manpower, resources, and assets in the Permian region.”

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Source: Dallas Innovates

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