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MTDR Strengthens Delaware Basin Footprint With Lease Acquisition
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Key Takeaways
Matador acquired 5,154 net undeveloped acres in Southeast New Mexico for $1.1 billion.
Matador acquired 5,154 net undeveloped acres in Southeast New Mexico for $1.1 billion.
Matador expects to reduce acquisition-related debt using projected 2026 free cash flow of $1.2 billion.
Matador Resources Company ((MTDR - Free Report) ) announced a major expansion of its Delaware Basin footprint through the acquisition of 5,154 net undeveloped acres in Southeast New Mexico at the recent Bureau of Land Management Oil and Gas Lease Sale. The $1.1 billion expansion strengthens Matador’s position in the most prolific region of the Delaware Basin. The acquisition adds more than 141 new drilling opportunities, which is expected to improve production efficiency and lower costs through longer two-mile wells, shared infrastructure, better water recycling and stronger natural gas transportation capacity.
The newly acquired acreage is strategically located adjacent to Matador’s existing operated units, enabling the company to leverage its established infrastructure. Per management, the acreage contains exposure to nine or more prospective formations and creates development opportunities such as extended-reach laterals exceeding three miles, U-turn well designs, multi-well developments and improved water recycling initiatives. The acquisition is also expected to boost throughput and revenue generation for the company’s San Mateo midstream business.
Matador will keep 87.5% of the revenues generated from oil and gas production on the acreage and has the right to develop the land for 10 years across all underground resource zones. After accounting for anticipated midstream value, the acquisition cost equates to roughly $7.3 million per drilling location.
Management proceeded with the transaction, pointing to the lucrative results of its 2018 State Line and Rodney Robinson federal lease acquisitions, which generated enough returns to fully repay the initial investments and yielded an additional $1.9 billion in profits. The deal is expected to be funded through cash on hand and Matador’s credit facility. Supported by projected 2026 adjusted free cash flow of nearly $1.2 billion, the company expects to substantially reduce acquisition-related debt by year-end 2026 and fully repay its reserve-based lending facility during the first half of 2027.
MTDR's Zacks Rank & Stocks to Consider
MTDR currently sports a Zacks Rank #1 (Strong Buy).
With West Texas Intermediate prices surpassing the $90-per-barrel mark, according to oilprice.com, the upstream portfolios of FANG, EQNR, XOM and MTDR are benefiting from a favorable pricing environment.
Diamondback Energy operates exclusively within the prolific Permian Basin and focuses on unconventional horizontal drilling across stacked geological formations such as the Wolfcamp and Spraberry. As of March 31, 2026, FANG had 890,496 net acres in the Permian Basin, including 797,074 net acres in the Midland Basin and 93,422 net acres in the Delaware Basin.
Equinor is a Norwegian multinational energy company that explores, develops and produces petroleum and natural gas. EQNR’s Norway production increased 10% to 1,525 thousand barrels of oil equivalent per day (MBoe/d) from 1,390 MBoe/d in the prior-year quarter, supported by new fields and additional wells coming online.
By leveraging advantaged assets such as the prolific Permian Basin, offshore Guyana and LNG ventures, ExxonMobil generated substantial revenues. In the first quarter of 2026, XOM’s liquids production was 3,297 thousand barrels per day (Mbpd), up from 3,139 Mbpd in the prior-year quarter, bolstered by increased output in the United States, Canada and Other Americas.
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MTDR Strengthens Delaware Basin Footprint With Lease Acquisition
Key Takeaways
Matador Resources Company ((MTDR - Free Report) ) announced a major expansion of its Delaware Basin footprint through the acquisition of 5,154 net undeveloped acres in Southeast New Mexico at the recent Bureau of Land Management Oil and Gas Lease Sale. The $1.1 billion expansion strengthens Matador’s position in the most prolific region of the Delaware Basin. The acquisition adds more than 141 new drilling opportunities, which is expected to improve production efficiency and lower costs through longer two-mile wells, shared infrastructure, better water recycling and stronger natural gas transportation capacity.
The newly acquired acreage is strategically located adjacent to Matador’s existing operated units, enabling the company to leverage its established infrastructure. Per management, the acreage contains exposure to nine or more prospective formations and creates development opportunities such as extended-reach laterals exceeding three miles, U-turn well designs, multi-well developments and improved water recycling initiatives. The acquisition is also expected to boost throughput and revenue generation for the company’s San Mateo midstream business.
Matador will keep 87.5% of the revenues generated from oil and gas production on the acreage and has the right to develop the land for 10 years across all underground resource zones. After accounting for anticipated midstream value, the acquisition cost equates to roughly $7.3 million per drilling location.
Management proceeded with the transaction, pointing to the lucrative results of its 2018 State Line and Rodney Robinson federal lease acquisitions, which generated enough returns to fully repay the initial investments and yielded an additional $1.9 billion in profits. The deal is expected to be funded through cash on hand and Matador’s credit facility. Supported by projected 2026 adjusted free cash flow of nearly $1.2 billion, the company expects to substantially reduce acquisition-related debt by year-end 2026 and fully repay its reserve-based lending facility during the first half of 2027.
MTDR's Zacks Rank & Stocks to Consider
MTDR currently sports a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the energy sector are Diamondback Energy, Inc. (FANG - Free Report) , Equinor ASA (EQNR - Free Report) and Exxon Mobil Corporation (XOM - Free Report) . FANG, EQNR and XOM sport a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
With West Texas Intermediate prices surpassing the $90-per-barrel mark, according to oilprice.com, the upstream portfolios of FANG, EQNR, XOM and MTDR are benefiting from a favorable pricing environment.
Diamondback Energy operates exclusively within the prolific Permian Basin and focuses on unconventional horizontal drilling across stacked geological formations such as the Wolfcamp and Spraberry. As of March 31, 2026, FANG had 890,496 net acres in the Permian Basin, including 797,074 net acres in the Midland Basin and 93,422 net acres in the Delaware Basin.
Equinor is a Norwegian multinational energy company that explores, develops and produces petroleum and natural gas. EQNR’s Norway production increased 10% to 1,525 thousand barrels of oil equivalent per day (MBoe/d) from 1,390 MBoe/d in the prior-year quarter, supported by new fields and additional wells coming online.
By leveraging advantaged assets such as the prolific Permian Basin, offshore Guyana and LNG ventures, ExxonMobil generated substantial revenues. In the first quarter of 2026, XOM’s liquids production was 3,297 thousand barrels per day (Mbpd), up from 3,139 Mbpd in the prior-year quarter, bolstered by increased output in the United States, Canada and Other Americas.