Mach Natural Resources has entered into two separate definitive agreements: one to acquire certain oil and gas assets from Sabinal Energy, and another to acquire entities owning oil and gas assets managed by IKAV Energy Inc (collectively “IKAV San Juan”).

The combined consideration for both transactions is approximately $1.3 billion, subject to customary terms, conditions, and closing price adjustments. The Transactions are expected to close during the third quarter of 2025, each with an effective date of April 1, 2025.

Key Highlights

Attractively Priced and Immediately Accretive to Cash Available for Distribution

• $1.3 billion aggregate purchase price represents a discount to PDP PV-10
• Immediately accretive to cash available for distribution, while pro forma Mach maintains low leverage and a reinvestment rate below 50%

Increases Scale with Permian Basin and San Juan Basin Entry

• Nearly doubles Mach’s production, increasing from 81 Mboe/d to approximately 152 Mboe/d
• Increases pro forma natural gas exposure from 53% to 66%
• Adds approximately 700,000 net acres—growing total acreage by 33% to 2.8 million acres

Diversifies Asset Base Across Three Prolific Basins

• Establishes presence in the Permian and San Juan Basins, complementing Mach’s existing Mid-Continent operations
• Creates a balanced production portfolio with approximately 55% exposure to the Mid-Continent and approximately 45% to the Permian and San Juan Basins
• Enhances capital allocation flexibility—supporting free cash flow optimization—across commodity cycles
• Opportunity to deploy a rig in the San Juan Dry Gas Mancos Shale in Spring 2026 based on pricing environment

Enhances Strategic Growth Platform

• Increased scale strengthens Mach’s operational reach and ability to pursue future accretive acquisitions
• Positions Mach as a natural consolidator in multiple basins—materially expanding the number of compelling acquisition opportunities
• Supports a more flexible approach to future acquisitions—which aligns with Mach’s long-term commitment to value creation and unitholder returns

Tom L. Ward, Chief Executive Officer of Mach, noted,
“These acquisitions are transformative for Mach. They not only strengthen our asset base but also advance the core pillars on which we’ve built the Company since our founding. With this step, we significantly enhance our scale and gain strategic multi-basin positioning, all while maintaining a resilient balance sheet. Most importantly, the transactions are expected to be immediately accretive to our cash available for distribution, underscoring our commitment to delivering long-term value to our unitholders.”

Mark Teshoian, Co-Managing Partner of Kayne’s Energy Private Equity practice, stated, 
“We are excited to partner with Tom and the Mach team on this transformative transaction. Our firms share a common vision of aggregating shallow-decline, free cash flowing assets and creating value through a strong commitment to equity distributions. We believe the addition of the Sabinal assets to the Mach platform will significantly enhance its long-term success and position the Company for continued consolidation in the Permian.”

Constantin von Wasserschleben, Chairman of IKAV, noted, 
“We are excited to transition IKAV’s San Juan assets into Mach Natural Resources and to become a significant shareholder of the Company. Mach’s strong industrial logic aligns with our long-term vision for this exceptional asset and beyond. The return of a public Company to the basin underscores the deep value and long-term potential of the asset. With our outstanding local team and the strength of Mach’s management team, we believe we can unlock even greater value in the basin. IKAV remains firmly committed to the belief that the world needs access to affordable and reliable energy.”

Mach Chairman, Founder and Managing Partner of Bayou City Energy, William W. McMullen, commented,
“With these two transactions, we grew Mach’s production by 88% and we will continue to look for consolidation opportunities given our conservative balance sheet.” William W. McMullen added, “These acquisitions strengthen what is already the most attractive yield in the oil and gas space, and among the strongest yields available across the entire economy. We also welcome the partnerships with Kayne and IKAV as we continue to generate significant returns for all of our unitholders.”

Permian Basin Entry

Mach has agreed to acquire Sabinal’s assets for an unadjusted purchase price of $500 million, subject to customary terms, conditions, and closing adjustments. Mach expects to fund the transaction with Sabinal with $300 million of equity consideration in the form of Mach common units, with the balance to be funded through a combination of cash on hand and borrowings under its Revolving Credit Facility.

The acquired Sabinal assets include approximately 130,000 net acres. First quarter 2025 average production was approximately 11 Mboe/d, of which 98% was liquids, 2% was natural gas.

San Juan Basin Entry

Mach has agreed to purchase IKAV San Juan for an unadjusted purchase price of $787 million, subject to customary terms, conditions, and closing adjustments. Mach expects to fund the transaction with IKAV San Juan with $462 million of equity consideration in the form of Mach common units, with the balance to be funded through a combination of cash on hand and borrowings under its Revolving Credit Facility.

IKAV San Juan’s assets include approximately 570,000 net acres. First quarter 2025 average production was approximately 60 Mboe/d, of which 6% liquids, 94% was natural gas.

KeyFacts Energy: Acquisitions & Mergers news   l   KeyFacts Energy Industry Directory: Mach Natural Resources