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FORT WORTH, Texas - TXO Partners, L.P. (NYSE: TXO), currently valued at $724 million in market capitalization, has announced an agreement to acquire producing assets in the Elm Coulee field in the Williston Basin, spanning Montana and North Dakota, from White Rock Energy, LLC. The deal, valued at approximately $350 million with additional purchase price adjustments, includes a $70 million deferred payment due one year post-closing. According to InvestingPro data, TXO maintains a moderate debt level with a debt-to-equity ratio of 0.28, suggesting financial capacity for this acquisition. The transaction also involves North Hudson Resource Partners LP, which will acquire a 30% non-operated interest in the assets, bringing the total value to $475 million based on a May 1, 2025, effective date.
The acquisition is set to position TXO as a leading oil producer in the Elm Coulee field, adding approximately 6,800 daily barrels of oil equivalent production to its portfolio, with around 93% of that being liquid. The added Proved Developed reserves are about 25,000 Mboe as of April 30, 2025. The company’s current operations generate annual revenue of $299.7 million with an EBITDA of $62.82 million. InvestingPro analysis reveals 8 additional key insights about TXO’s operational efficiency and growth potential. The closing of the transaction is anticipated in the third quarter of 2025, subject to customary closing conditions.
Brent Clum, Co-Chief Executive Officer of TXO, highlighted the strategic fit of the acquisition, noting the strong well economics and potential for healthy economic returns despite lower oil prices. Gary D. Simpson, also a Co-Chief Executive Officer at TXO, emphasized the quality of the Elm Coulee field’s resources, which are estimated to contain about 4 billion barrels of oil, and the impact of horizontal drilling and completion techniques on reservoir recovery.
The financial advisor for White Rock was Jefferies LLC, with legal counsel provided by Vinson & Elkins LLP. TXO’s legal advisors for the acquisition and partnership with North Hudson were Kelly Hart & Hallman, LLP and Latham & Watkins LLP, respectively, while Gibson, Dunn & Crutcher LLP represented North Hudson.
TXO Partners, L.P. is known for its focus on developing oil and natural gas reserves in North America, with significant positions in the Permian Basin, San Juan Basin, and the Williston Basin. The company maintains a notable dividend yield of 13.94% and trades at an attractive P/E ratio relative to its near-term earnings growth potential. According to InvestingPro’s Fair Value analysis, TXO currently appears slightly undervalued. North Hudson Resource Partners LP, an energy investment firm with over $1.4 billion in assets under management, has a diverse portfolio in key energy regions across North America.
This press release contains forward-looking statements, including expectations regarding the acquisition’s closing and benefits, which are subject to risks and uncertainties. The information is based on a press release statement from TXO Partners, L.P.
In other recent news, TXO Partners has launched a public offering of $175 million in common units, with the potential to increase by an additional $26.25 million. The proceeds are intended to fund the acquisition of assets from White Rock Energy, though the offering is not contingent on the acquisition’s completion. Stifel analysts have reinstated coverage of TXO Partners with a Buy rating, setting a price target of $20 per share, citing the company’s experienced leadership and low debt as favorable factors. Additionally, TXO Partners has announced the appointment of Lawrence S. Massaro to its Board of Directors, enhancing its leadership team with his extensive experience in the energy sector.
The company has also granted executive awards to Co-CEOs Brent W. Clum and Gary D. Simpson, who were recently promoted following the announcement of Bob R. Simpson’s retirement as CEO. Simpson will remain as Chairman of the Board, while Clum and Simpson will lead the company as Co-CEOs. These leadership changes are part of TXO Partners’ strategic efforts to strengthen governance and business operations. The recent developments reflect the company’s focus on growth and stability in the energy sector, with an emphasis on maintaining strong leadership and financial health.
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