A milestone in offshore exploration: Talos Energy’s $1.29 billion strategic acquisition of QuarterNorth Energy
The acquisition, which enhances shareholder value through immediate financial accretion, is structured with 24.8 million Talos shares and approximately $965 million in cash. The boards of directors of Talos and QuarterNorth Energy unanimously approved this transaction, establishing a clear path to completion in the first quarter of 2024, pending standard closing conditions and regulatory clearances.
➡ Key Transaction Highlights:
✔ Adds production of approximately 30 thousand barrels of oil equivalent per day (“MBoe/d”) expected for all of 2024, averaging around 75% oil from approximately 95% of operated assets.
✔Adds proven reserves1 of approximately 69 million barrels of oil equivalent (“MMBoe”) with a PV-10 of $1.7 billion.
✔High margin, low production decline, with low reinvestment rate requirements to sustain production and no significant short-term asset retirement obligations (“ARO”) leading to high long-term free cash flow generation term.
✔Adds value to key financial metrics, including cash flow per share, free cash flow per share and net asset value per share.
✔Annual run rate synergies of approximately $50 million are expected to be achieved by the end of 2024.
✔Improves balance sheet strength with an expected end-20242 leverage ratio of 1.0x or less.
This strategic move significantly boosts Talos’ presence in deepwater exploration, providing high-quality assets with promising future development opportunities.
This strategic move significantly boosts Talos’ presence in deepwater exploration, providing high-quality assets with promising future development opportunities.
The strategic importance of this acquisition is underscored by the unanimous approval of the boards of directors of Talos Energy and QuarterNorth Energy. This gesture of confidence indicates a unified vision for growth and expansion in the offshore exploration sector.
Looking ahead, the transaction is on track to complete by the end of the first quarter of 2024. This timeline is dependent on meeting customary closing conditions and obtaining necessary regulatory approvals. This acquisition is not just a transaction; is a testament to Talos Energy’s commitment to strengthening its position as a leader in offshore exploration and production, poised to reshape the future of the industry.
Read the full press release here: https://s201.q4cdn.com/120347489/files/doc_downloads/key_docs_social/2024-01-15-Talos-Energy-QuarterNorth-Acquisition-Announcement-Presentation-vFINAL.pdf