SandRidge Energy, Inc. Announces Acquisition of Overriding Royalty Interests

SandRidge Energy, Inc. (NYSE:SD) announced the acquisition of overriding royalty interest assets from SandRidge Mississippian Trust I for $4.85 million, netting $3.55 million due to a 26.9% ownership stake.

Rhea-AI Summary

SandRidge Energy, Inc. (NYSE:SD) announced the acquisition of overriding royalty interest assets from SandRidge Mississippian Trust I for $4.85 million, netting $3.55 million due to a 26.9% ownership stake. The acquisition is deemed attractive based on projected cash flow and production trends, with expectations of a 2-year cash-on-cash payback. President and CEO Carl Giesler emphasized that this strategic move will enhance the company's reserves, netbacks, and cash flow, reflecting a commitment to shareholder value.

Positive

• Acquisition enhances PDP reserves, improving netbacks and cash flow.
• Acquisition is expected to yield a 2-year cash-on-cash payback.
• Strategic investment aligns with the company's focus on high-return, low-capital ventures.

Negative

• None.

Argus Session date unavailable

+6.50% session move Open Argus

Details

News Market Reaction – SD

The recorded move for SD in the trading session of this news was +6.50%.

Data tracked by StockTitan Argus. Session date unavailable.

AI-generated analysis. How Rhea-AI works. Not financial advice.

See more from StockTitan in Google Search and AI answers. Adds StockTitan as a preferred source · opens Google

Add on Google Not now

OKLAHOMA CITY, April 22, 2021 /PRNewswire/ -- SandRidge Energy, Inc. (NYSE:SD) (the "Company") today announced the acquisition of all the overriding royalty interest assets of SandRidge Mississippian Trust I (the "Trust"). The gross purchase price is $4.85 million (net $3.55 million, given the Company's 26.9% ownership of the Trust) ("the Acquisition"). At the current strip and based on historical production trends, the Company believes the Acquisition represents an attractive price-to-value, approximating PDP PV-55 and a 2-year cash-on-cash payback.

Carl Giesler, President and CEO commented, "Buying in the ORRIs from SDT will add to our PDP reserves and improve our netbacks and cash flow in wells that we already operate for the most part. This Acquisition is a good example of the relatively low-capital, high-return, quick-payback, 'small-ball' investments that the Board and management are making to increase shareholder value realization from its asset base."

About SandRidge Energy, Inc.
SandRidge Energy, Inc. (NYSE: SD) is an independent oil and gas company engaged in the development and acquisition of oil and gas properties. Its primary area of operations is the Mid-Continent region in Oklahoma and Kansas.  Further information can be found at www.sandridgeenergy.com.

For further information, please contact:

Investor Relations
SandRidge Energy, Inc.
1 E. Sheridan Ave. Suite 500
Oklahoma City, OK 73104
investors@sandridgeenergy.com

View original content to download multimedia:http://www.prnewswire.com/news-releases/sandridge-energy-inc-announces-acquisition-of-overriding-royalty-interests-301275467.html

SOURCE SandRidge Energy, Inc.

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What did SandRidge Energy announce on April 22, 2021?

SandRidge Energy announced the acquisition of overriding royalty interest assets from SandRidge Mississippian Trust I for $4.85 million.

What is the net acquisition cost for SandRidge's purchase from the Trust?

The net acquisition cost is $3.55 million due to the company's 26.9% ownership in the Trust.

How does this acquisition impact SandRidge Energy's cash flow?

The acquisition is expected to improve cash flow and netbacks from wells already operated by the company.

What is the expected payback period for the acquisition?

The expected payback period for the acquisition is approximately 2 years.

How does this acquisition fit into SandRidge Energy's investment strategy?

This acquisition reflects SandRidge's strategy of making low-capital, high-return investments to enhance shareholder value.