HOUSTON (Reuters) – Felix Energy LLC, a closely held Denver-based oil producer with operations in the largest U.S. shale field, is exploring a sale that could value the company at more than $3.5 billion, two people familiar with the matter said on Wednesday.
The U.S. oil producer has hired investment bank Jefferies to solicit buyers, the sources said.
Felix Energy did not respond to requests for comment.
Premium prices paid this year for acreage in the Permian Basin of West Texas and New Mexico, the largest and fastest growing oilfield, has smaller companies looking to cash in on their holdings. At the same time, higher crude oil prices have allowed bigger oil producers to acquire new holdings.
Endeavor Energy Resources LP [EERL.UL], an oil producer in Texas, also is exploring a sale that could value the company at more than $10 billion.
Earlier this year, RSP Permian and Energex Corp (EGN.N) were bought by Concho Resources Inc (CXO.N) for $8 billion and Diamondback Energy Inc (FANG.O) for $9.2 billion, respectively. Concho paid more than $70,000 an acre in its deal.
Felix’s management team sold assets in Oklahoma to Devon Energy Corp (DVN.N) in January 2016 for more than $1.9 billion, according to the company’s website.
The company’s acreage in the Permian Basin is concentrated in the oil-rich Delaware Basin in Loving, Winkler and Ward counties in Texas. Felix has more than 70,000 net acres in the Permian Basin, one of the people familiar with the matter said.