Matador Resources Company announced the successful acquisition of 5,154 net undeveloped acres in the core of the Delaware Basin as part of the Bureau of Land Management oil and gas lease sale held this week. The Dallas-based company said the acquisition represents a strategic $1.1 billion expansion of its asset base in Southeast New Mexico.
The company noted that the newly acquired acreage is located in some of the most prolific areas of the Delaware Basin and includes exposure to nine or more prospective formations. The acreage is directly adjacent to Matador’s existing operated units, which the company believes will create additional operating efficiencies and strengthen its existing footprint in the region.
Matador said the acquisition adds more than 141 net operated drilling locations, normalized to two-mile laterals, and creates opportunities for extended reach laterals of three miles or more, U-Turn well designs, multi-well developments, emerging horizons and enhanced water recycling processes. The company also highlighted that the lease terms include an 87.5% net revenue interest with a 10-year term across all depths.
The acquisition is expected to strengthen the company’s midstream operations through additional throughput volumes tied to its San Mateo infrastructure assets. Matador added that the purchase price of approximately $1.143 billion equates to about $7.3 million per location after accounting for anticipated midstream value. The company plans to fund the acquisition through cash on hand and its existing credit facility.
Matador stated that it has fully repaid its reserve-based lending facility and expects full-year 2026 adjusted free cash flow to approach $1.2 billion based on strip oil and natural gas pricing from early May 2026. The company said it anticipates substantially paying down the acquisition by the end of 2026 and fully repaying the reserve-based lending facility during the first half of 2027.
The company also pointed to its prior 2018 acquisition of the State Line and Rodney Robinson Federal tracts, noting that it has already recovered all associated capital invested in those projects while generating an additional $1.9 billion in returns.
Matador Resources Company is an independent energy company focused on the exploration, development, production and acquisition of oil and natural gas resources in the United States. Its operations are primarily concentrated in the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas, along with operations in the Haynesville shale and Cotton Valley plays in Northwest Louisiana. The company also operates midstream infrastructure supporting its upstream activities.
KEY QUOTES:
“Matador is pleased to announce a $1.1 billion expansion of its premier Delaware Basin asset base in Southeast New Mexico through the recent BLM Lease Sale. The company acquired 5,154 net undeveloped acres, all of which are in the ‘core-of-the-core’ of the Delaware Basin and are strategic and highly complementary to Matador’s current acreage position. This acquisition not only extends the amount and the duration of Matador’s high-quality inventory and reserve base but also enhances the Company’s current assets with increased operating efficiencies. These lease acquisitions lend themselves to extended reach laterals of three miles or more, leveraging of existing facilities and infrastructure with Matador’s existing field teams, and increased midstream value from potential future volume additions in the Delaware Basin.
We believe our proven track record of value creation over the years de-risks this transaction as evidenced by our 2018 acquisition of the State line and Rodney Robinson Federal tracts. To date, Matador has already recovered all associated capital invested in lease acquisitions, drilling, and completions associated with those tracts, as well as generating an additional $1.9 billion in returns from these projects. We have full confidence that our reservoir, geology, midstream, and operating teams will maximize the value of these new tracts in a similar manner.
Matador has fully repaid its reserve-based lending (RBL) facility, providing ample liquidity for this transaction. Furthermore, under our current operating plan, we anticipate full-year 2026 adjusted free cash flow to approach $1.2 billion (assuming strip oil and natural gas pricing as of early May 2026). This strong cash generation gives us clear line of sight to substantially pay down this acquisition by year-end 2026 and to fully pay down the RBL in the first half of 2027.
We would like to thank our shareholders, bondholders, directors, banks, and staff here in Dallas and the field for their continued support and recognition of Matador’s asset quality, cash flow and our expectations for another record year for the Company. We hope to see you at our Annual Meeting on June 11, 2026, here in Dallas where we will have more operational and financial news to share.”
Joseph Wm. Foran, Founder, Chairman and CEO, Matador Resources Company
