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Business Combinations and Divestitures
 12 Months Ended
Dec. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
BUSINESS COMBINATIONS AND DIVESTITURES
NOTE 6 — BUSINESS COMBINATIONS AND DIVESTITURES
Business Combinations
San Mateo Joint Venture
On December 18, 2024, the Company completed a transaction with Five Point Infrastructure, LLC and its affiliates (previously, Five Point Energy LLC) (“Five Point”) in which the Company contributed Pronto Midstream, LLC and its subsidiary (“Pronto”), a wholly-owned subsidiary of the Company, to San Mateo, and Five Point made a cash contribution to San Mateo of $171.5 million (the “Pronto Transaction”). In connection with the Pronto Transaction, the Company received a special distribution from San Mateo of approximately $219.8 million. In addition, the Company has the potential to earn up to $75.0 million in incentive payments from Five Point over a five-year period, of which $13.0 million and $1.3 million was paid by Five Point during the years ended December 31, 2025 and 2024, respectively. San Mateo continues to be owned 51% by the Company and 49% by Five Point, with Five Point’s interest in San Mateo being accounted for as a non-controlling interest.
Subsequent to the Pronto Transaction, San Mateo owns and operates the expanded Marlan Processing Plant, which has a designed inlet capacity of 260 MMcf of natural gas per day, and operates Pronto’s six compressor stations and approximately 150 miles of natural gas gathering pipelines in Lea and Eddy Counties, New Mexico.
In connection with the Pronto Transaction, the Company dedicated to San Mateo its current and certain future leasehold interests in the Ranger and Antelope Ridge asset areas pursuant to 15-year, fixed fee natural gas gathering, compression, treating and processing agreements whereby San Mateo will gather, compress, treat and process natural gas produced from the Company’s operated wells in northern Lea County, New Mexico. In addition, San Mateo entered into certain agreements with Northwind Midstream Partners LLC (“Northwind”), previously an affiliate of Five Point, whereby Northwind will treat certain sour gas gathered and delivered by San Mateo in northern Lea County, New Mexico. Under these agreements, Northwind will redeliver the treated sweet gas from San Mateo and other third-party customers to San Mateo for processing.
Ameredev Acquisition
On September 18, 2024, a wholly-owned subsidiary of the Company completed the acquisition (the “Ameredev Acquisition”) of Ameredev Stateline II, LLC (“Ameredev”) from affiliates of EnCap Investments L.P., including (i) certain oil and natural gas producing properties and undeveloped acreage located in Lea County, New Mexico and Loving and Winkler Counties, Texas, and (ii) an approximate 19% stake (the “Piñon Investment”) in the parent company of Piñon Midstream, LLC (“Piñon”). The Ameredev Acquisition had an effective date of June 1, 2024 and an aggregate as-adjusted closing purchase price of approximately $1.83 billion in cash. The purchase price for the Ameredev Acquisition was funded by a combination of cash on hand and borrowings under the Company’s Credit Agreement, which was amended on September 18, 2024 to, among other things: (i) provide for a term loan of $250.0 million, the full amount of which was borrowed to fund the Ameredev Acquisition, and (ii) increase the elected borrowing commitments under the revolving credit facility from $1.50 billion to $2.25 billion. On September 25, 2024, the Company completed the sale of $750.0 million in aggregate principal amount of the Company’s 6.25% senior unsecured notes due 2033 (the “2033 Notes”) and used the net proceeds to partially repay borrowings outstanding under the Credit Agreement, including all of the $250.0 million in outstanding borrowings under the term loan.
The Ameredev Acquisition was accounted for under the acquisition method of accounting as a business combination in accordance with ASC Topic 805, Business Combinations. Under ASC Topic 805, the purchase price is allocated to the underlying tangible and intangible assets acquired and liabilities assumed based upon their estimated fair values as of the respective acquisition date, with any excess purchase price allocated to goodwill. As the Company acquired 100% of the membership interests of Ameredev, the acquisition was treated as an asset acquisition for tax purposes. The Company concluded that the Piñon Investment was an equity method investment.
The final allocation of the total purchase price for the Ameredev Acquisition is set forth below (in thousands).
ConsiderationAllocation
Cash consideration given$1,831,214 
Allocation of purchase price
Current assets$51,499 
Oil and natural gas properties
Evaluated1,316,532 
Unproved and unevaluated316,586 
Midstream assets117,762 
Equity method investment115,819 
Current liabilities(80,651)
Asset retirement obligations(6,333)
Net assets acquired$1,831,214 
The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair value of evaluated oil and natural gas properties and asset retirement obligations were measured using the discounted cash flow technique of valuation.
Significant inputs to the valuation of oil and natural gas properties include estimates of: (i) future production volumes, (ii) future commodity prices and (iii) recent market comparable transactions for unproved acreage. These inputs require significant judgments and estimates and are the most sensitive and subject to change.
Divestitures    
During the first quarter of 2025, the Company sold its remaining South Texas assets in the Eagle Ford shale for $22.2 million. During 2024, the Company converted approximately $12.4 million of non-core assets to cash. These properties were primarily located in South Texas and Northwest Louisiana.
On October 28, 2024, Piñon was acquired by an affiliate of Enterprise Products Partners L.P. The Company received $113.6 million from the sale of Piñon during the fourth quarter of 2024 and used these proceeds to reduce borrowings under the Credit Agreement. The Company received an additional $3.3 million from the sale of Piñon in the first half of 2025.