| Mid-Con On The Verge Of Deal Activity?

We recently met with several companies that operate in the Mid-Con and a few who aspire to operate in the Mid-Con. There have been a number of recently marketed Mid-Con opportunities including Citizen Energy, RimRock and Continental to name a few of the more notable packages. Not to mention, last year it seemed as if the entire Arkoma was for sale!

Several of the groups were optimistic they were in the running to capture some of these deals and other packages. The motivation seems to be to either expand their existing operations or acquire a cash flowing asset with running room.

One theme that emerged from these conversations, group are struggling with how to assign value in today’s market place, do you need to pay for upside in the Mid-Con or does a strong PDP offer win the day? With the pending deals, these questions should be answered soon and will establish a value baseline on which future sellers will anchor their expectations.

Lastly, we find the Mid-Con to be a region in which Private Equity believes they can compete against the publics where as in other premier basins (Permian, Eagle Ford and Williston) public companies have ruled the roost. We are hopefully any Mid-Con activity will encourage future deal making and we will be ready to break down the notable deals and help you remain informed.

| Today’s Upstream Updates

• Oil near 4-month low on OPEC+ supply outlook

• Heat wave in the west supporting natural gas prices

• US has slowly been adding to the Strategic Petroleum Reserves

| Markets - Energy Prices

Note: pricing is as of time of publishing.

| Morning News - Energy 

• Oil prices trend down after API reports large build in oil (oilprice.com)

• Natural Gas and Oil forecast (fxempire.com)

• US could boost rate of replenishing the SPR (Oil & Gas News)

• Permian Pulse: Franklin Mountain stands out (Hart Energy)

• TC Energy to spin off NA oil pipeline business (Reuters)

• Aramco looks to invest into US LNG facility (oilprice.com)

• America’s commute to work is getting longer (WSJ)

• Power hungry data centers spurring tech talk (Reuters)

| Noteworthy from Energy X (Twitter)

• Non-energy, but if you like shoe stories (Link)

• Copper has been the hot trade, but….(Link)

• Podcast interview of Larry Brogden of 4-7s Energy (Link)

| Monthly Upstream Deals

Pending Updates

| Monthly Capital Markets

• Debt 6/03/2024 - Diversified Energy (DEC) announced it has closed on an ABS refinancing. The $610 million principal notes with net proceeds of $592 million (net of fees, expenses and interest reserve) carry a blended fixed coupon of 7.28%. Proceeds to refinance existing ABS and reduce borrowings on Company RBL. Financing is also part of the Oaktree WI purchase. DEC noted the offering was oversubscribed with over $1.7 billion in orders from 18 investors (Link).

| Partnerships

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Disclaimer - The information provided in this newsletter is for informational purposes only and should not be construed as investment advice. The contents and references herein do not constitute a recommendation to buy, sell, or hold any securities. Readers are encouraged to conduct their own research and consult with a qualified financial advisor before making any investment decisions based on the information provided herein. The authors and publisher of this newsletter are not liable for any actions taken by readers based on the information contained here.