Matador Resources Company, an independent energy company, engages in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays.
The company’s current operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The company also has operations in the Eagle Ford...
Matador Resources Company, an independent energy company, engages in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays.
The company’s current operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The company also has operations in the Eagle Ford shale play in South Texas, and the Haynesville shale and Cotton Valley plays in Northwest Louisiana. Additionally, the company conducts midstream operations in support of, and to provide flow assurance for, its exploration, development, and production operations, and provides natural gas processing, oil transportation services, oil, natural gas, and produced water gathering services, and produced water disposal services to third parties.
Strategy
The company’s strategies are to focus its exploration and development activities primarily on unconventional plays, such as the Wolfcamp and Bone Spring plays in the Delaware Basin; identify, evaluate, and develop additional oil and natural gas plays as necessary to maintain a balanced portfolio of oil and natural gas properties; identify and develop midstream opportunities that support and enhance the company’s exploration and development activities, and that generate value for San Mateo and Matador; pursue opportunistic acquisitions, divestitures, and joint ventures; and provide the energy that society needs in a manner that is safe, protects the environment, and is consistent with the oil and natural gas industry’s best practices.
The successful execution of the company’s business strategies, including the Ameredev Acquisition, led to increases in the company’s oil and natural gas production and proved oil and natural gas reserves in 2024.
Ameredev Acquisition
On September 18, 2024, the company’s wholly-owned subsidiary completed the acquisition of Ameredev from affiliates of EnCap Investments L.P., including certain oil and natural gas producing properties and undeveloped acreage located in Lea County, New Mexico, and Loving and Winkler Counties, Texas. The Ameredev Acquisition had an effective date of June 1, 2024.
Matador conducts its midstream operations primarily through San Mateo, which is owned 51% by the company and 49% by the company’s joint venture partner, Five Point.
On December 18, 2024, the company completed a transaction with Five Point in which it contributed Pronto, a wholly-owned subsidiary of the company, to San Mateo, and Five Point made a cash contribution to San Mateo (the ‘Pronto Transaction’).
Pronto owns and operates the Marlan cryogenic natural gas processing plant (the ‘Marlan Processing Plant’), which has a designed inlet capacity of 60 MMcf of natural gas per day. Pronto is expanding the Marlan Processing Plant to add an additional plant with a designed inlet capacity of 200 MMcf of natural gas per day, which would increase the total capacity of the Marlan Processing Plant to 260 MMcf of natural gas per day. Pronto also owns and operates five compressor stations and approximately 120 miles of natural gas gathering pipelines in Lea and Eddy Counties, New Mexico.
In connection with the Pronto Transaction, the company dedicated to Pronto 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 Pronto will gather, compress, treat, and process natural gas produced from its operated wells in northern Lea County, New Mexico. In addition, Pronto entered into certain agreements with Northwind Midstream Partners LLC (‘Northwind’), an affiliate of Five Point, whereby Northwind will treat certain sour gas gathered and delivered by Pronto in northern Lea County, New Mexico.
In March 2024, the company completed its natural gas pipeline connections between Pronto and San Mateo, and between Pronto and Matador’s acreage obtained in the Advance Acquisition. These connector pipelines provide further flow assurance and options for the company and third-party customer natural gas, and resulted in Pronto and San Mateo’s plants operating at or above nameplate capacity at times during 2024.
During 2024, San Mateo and Pronto also closed new midstream transactions with oil and natural gas producers and other counterparties in Eddy and Lea Counties, New Mexico. A majority of these new opportunities reflect additional business awarded to San Mateo and Pronto by existing customers, which is indicative of the quality of service San Mateo and Pronto provide to all of their customers in the Delaware Basin.
As of December 31, 2024, following the Pronto Transaction, San Mateo’s midstream system included:
Natural Gas Assets: 520 MMcf per day of designed natural gas cryogenic processing capacity and approximately 295 miles of natural gas gathering pipelines in Eddy and Lea Counties, New Mexico, and Loving County, Texas, including 43 miles of large diameter natural gas gathering lines spanning from the Stateline asset area to the southern portion of the Arrowhead asset area (the ‘Greater Stebbins Area’);
Oil Assets: three oil central delivery points (‘CDP’) with over 100,000 Bbl of designed oil throughput capacity and approximately 110 miles of oil gathering and transportation pipelines in Eddy County, New Mexico, and Loving County, Texas, as well as a 400,000-acre joint development area with Plains Marketing, L.P. (‘Plains’) to gather the company’s and other producers’ oil production in Eddy County, New Mexico;
Produced Water Assets: 16 commercial salt water disposal wells and associated facilities with designed produced water disposal capacity of 475,000 Bbl per day and approximately 180 miles of produced water gathering pipelines in Eddy County, New Mexico, and Loving County, Texas.
On September 18, 2024, the company completed the Ameredev Acquisition, which included approximately 180 miles of gas gathering, water gathering, and oil transportation and gathering pipeline assets.
Exploration and Production Segment
The company’s current operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The company also has operations in the Eagle Ford shale play in South Texas, and the Haynesville shale and Cotton Valley plays in Northwest Louisiana.
The company is active both as an operator and as a non-operating, co-working interest owner with various industry participants. As of December 31, 2024, the company operated a significant majority of its acreage in the Delaware Basin in Southeast New Mexico and West Texas. In those wells where the company is not the operator, its working interests are often relatively small. As of December 31, 2024, the company also operated approximately 100% of its Eagle Ford acreage and approximately 51% of its Northwest Louisiana acreage.
Southeast New Mexico and West Texas — Delaware Basin
The greater Permian Basin in Southeast New Mexico and West Texas is a mature exploration and production region with extensive developments in a wide variety of petroleum systems, resulting in stacked target horizons in many areas. Historically, the majority of development in this basin had focused on relatively conventional reservoir targets, but the combination of advanced formation evaluation, 3-D seismic technology, horizontal drilling, and hydraulic fracturing technology has enhanced the development potential of this basin, particularly in the organic-rich shales, or source rocks, of the Wolfcamp formation, and in the low permeability sand and carbonate reservoirs of the Bone Spring, Brushy Canyon, and Avalon formations.
In the western part of the Permian Basin, also known as the Delaware Basin, there are multiple horizontal targets in a given area that exist within the several thousand feet of hydrocarbon-bearing layers that make up the Bone Spring and Wolfcamp plays. Multiple horizontal drilling and completion targets are being identified and targeted by companies, including the company, throughout the vertical section, including the Brushy Canyon, Avalon, and Bone Spring (First, Second, and Third Sand and Carbonate) and several intervals within the Wolfcamp shale, often identified as Wolfcamp A through D.
As of December 31, 2024, the company’s total acreage position in Southeast New Mexico and West Texas was approximately 328,000 gross (198,700 net) acres, primarily in Lea and Eddy Counties, New Mexico, and Loving, Ward, and Winkler Counties, Texas. These acreage totals included approximately 73,700 gross (42,100 net) acres in its Ranger asset area in Lea County, 59,600 gross (24,000 net) acres in its Arrowhead asset area in Eddy County, 47,000 gross (26,500 net) acres in its Rustler Breaks asset area in Eddy County, 63,800 gross (50,400 net) acres in its Antelope Ridge asset area in Lea County, 2,900 gross (2,900 net) acres in its Stateline asset area in Eddy County, 47,300 gross (30,000 net) acres in its Twin Lakes asset area in Lea County, and 33,200 gross (22,300 net) acres in its West Texas asset area in Loving, Ward, and Winkler Counties at December 31, 2024. The company considers the vast majority of its Delaware Basin acreage position to be prospective for oil and liquids-rich targets in the Bone Spring and Wolfcamp formations. Other potential targets on certain portions of the company’s acreage include the Brushy Canyon and Avalon formations, as well as the Abo, Strawn, Devonian, Penn Shale, Atoka, Yeso, and Morrow formations. As of December 31, 2024, the company’s acreage position in the Delaware Basin was approximately 79% held by existing production. Excluding the Twin Lakes asset area, the company’s acreage position in the Delaware Basin was approximately 88% held by existing production as of December 31, 2024.
During the year ended December 31, 2024, the company continued the delineation and development of its Delaware Basin acreage. The company completed and began producing oil and natural gas from 251 gross (110.2 net) horizontal wells in the Delaware Basin, including 124 gross (101.9 net) operated horizontal wells and 127 gross (8.3 net) non-operated horizontal wells, throughout its various asset areas. At December 31, 2024, the company had tested a number of different producing horizons at various locations across its acreage position, including the Brushy Canyon, two benches of the Avalon, two benches of the First Bone Spring, the Second Bone Spring Carbonate, three benches of the Second Bone Spring Sand, three benches of the Third Bone Spring Carbonate, two benches of the Third Bone Spring Sand, four benches of the Wolfcamp A, including the X, Y, and Z sands, and the more organic, lower section of the Wolfcamp A, three benches of the Wolfcamp B, the Wolfcamp D, the Strawn, and the Morrow.
As of December 31, 2024, the company had identified 5,080 gross (1,869 net) engineered locations for potential future drilling on its Delaware Basin acreage, primarily in the Wolfcamp and Bone Spring plays, but also, including the shallower Brushy Canyon, Yeso, and Avalon formations. As of December 31, 2024, these locations had a total net lateral length of approximately 18.3 million feet, or 3,680 miles. These locations include 2,546 gross (1,667 net) locations that the company anticipates operating, as it holds a working interest of at least 25% in each of these locations.
Antelope Ridge Asset Area - Lea County, New Mexico
In the second quarter of 2024, the company achieved an operational milestone when it turned to sales 21 gross (18.9 net) wells in the Antelope Ridge asset area that were acquired as part of the Advance Acquisition. Each of these wells had a lateral length of 1.5 miles, resulting in approximately 155,000 completed lateral feet. These wells included three First Bone Spring, six Second Bone Spring, three Third Bone Spring, six Third Bone Spring Carbonate, and three Wolfcamp A-XY completions, which averaged 24-hour initial production tests of 1,728 BOE per day, with oil cuts averaging 83%, and have in aggregate produced 4.2 million BOE in approximately eight months of production.
Stateline Asset Area - Eddy County, New Mexico
The company’s wells, which included four Upper Avalon and two Lower Avalon completions, have produced in aggregate approximately 0.4 million BOE in approximately seven months of production. These six wells had average completed lateral lengths of approximately 12,100 feet.
Ranger and Twin Lakes Asset Areas - Lea County, New Mexico
In total, these ten Ranger operated wells, which included four First Bone Spring, four Second Bone Spring, one Third Bone Spring, and one Avalon completions, have produced in aggregate approximately 1.5 million BOE in an average of approximately eight months of production. These ten wells had average completed lateral lengths of approximately 10,100 feet.
Arrowhead Asset Area - Eddy County, New Mexico
The company’s wells, which included eight Wolfcamp A and eight Second Bone Spring completions, have produced in aggregate approximately 2.5 million BOE in approximately six months of production. These 16 wells had average completed lateral lengths of approximately 9,800 feet.
Rustler Breaks Asset Area - Eddy County, New Mexico
The company turned to sales 32 gross (23.5 net) operated wells in the Rustler Breaks asset area during 2024. In total, these 32 Rustler Breaks wells, which included ten First Bone Spring, six Second Bone Spring, 12 Third Bone Spring Carbonate, and four Wolfcamp B completions, have produced in aggregate approximately 5.7 million BOE in an average of approximately six months of production. These 32 wells had average completed lateral lengths of approximately 9,100 feet.
South Texas — Eagle Ford Shale and Other Formations
During the fourth quarter of 2024, the company divested certain non-core assets in the Eagle Ford shale for approximately $11.5 million. As of December 31, 2024, the company’s remaining properties included approximately 2,900 gross (2,900 net) acres in the Eagle Ford shale play in South Texas. All of the company’s Eagle Ford leasehold was held by existing production as of December 31, 2024.
Northwest Louisiana — Haynesville Shale, Cotton Valley, and Other Formations
The company did not conduct any operated drilling and completion activities on its leasehold properties in Northwest Louisiana during 2024, although it did participate in the drilling and completion of eight gross (0.1 net) non-operated Haynesville shale wells that were turned to sales in 2024.
As of December 31, 2024, the company held approximately 18,500 gross (17,300 net) acres in Northwest Louisiana, including 16,200 gross (8,900 net) acres in the Haynesville shale play and 15,700 gross (14,800 net) acres in the Cotton Valley play. The company operates substantially all of its Cotton Valley and shallower production on its leasehold interests in Northwest Louisiana, as well as all of its Haynesville production on the acreage outside of what is to be the core area of the Haynesville shale play. The company operates approximately 8% of the 11,600 gross (4,700 net) acres that it considers to be in the core area of the Haynesville shale play. All of the company’s leasehold in the Haynesville and Cotton Valley plays in Northwest Louisiana was held by existing production as of December 31, 2024.
For the year ended December 31, 2024, approximately 2% of its average daily oil equivalent production, or 3,492 BOE per day, including three Bbl of oil per day and 21.0 MMcf of natural gas per day, was attributable to its leasehold interests in Northwest Louisiana, while for the year ended December 31, 2023, approximately 3% of its average daily oil equivalent production, or 4,025 BOE per day, including five Bbl of oil per day and 24.1 MMcf of natural gas per day, was attributable to the company’s properties in Northwest Louisiana. For the year ended December 31, 2024, approximately 5% of the company’s daily natural gas production, or 21.0 MMcf of natural gas per day, was attributable to its leasehold interests in Northwest Louisiana, while for the year ended December 31, 2023, approximately 7% of the company’s daily natural gas production, or 24.1 MMcf of natural gas per day, was attributable to these properties. As of December 31, 2024, less than 1% of the company’s estimated total proved reserves, or 3.7 million BOE, was attributable to its properties in Northwest Louisiana.
Midstream Segment
The company’s midstream segment conducts midstream operations in support of, and provides flow assurance for, its exploration, development, and production operations, and provides natural gas processing, oil transportation services, oil, natural gas, and produced water gathering services, and produced water disposal services to third parties.
Southeast New Mexico and West Texas — Delaware Basin
On February 17, 2017, the company announced the formation of San Mateo, a strategic joint venture with Five Point. The midstream assets that were contributed to San Mateo included San Mateo’s Black River cryogenic natural gas processing plant in Eddy County, New Mexico (the ‘Black River Processing Plant’) (before its expansions); one salt water disposal well and a related commercial salt water disposal facility in the Rustler Breaks asset area; three salt water disposal wells and related commercial salt water disposal facilities in the West Texas asset area, and substantially all related oil, natural gas, and produced water gathering systems and pipelines in both the Rustler Breaks asset area and in Loving County, Texas (collectively, the ‘Delaware Midstream Assets’).
On February 25, 2019, the company announced the formation of San Mateo Midstream II, LLC (‘San Mateo II’), a strategic joint venture with Five Point designed to expand its midstream operations in the Delaware Basin, specifically in Eddy County, New Mexico.
The company retains operational control of San Mateo and continues to operate the Delaware Midstream Assets, the expanded Black River Processing Plant, and the other midstream facilities that have been developed in the Greater Stebbins Area and the Stateline asset area.
On June 30, 2022, the company acquired Pronto, including the Marlan Processing Plant, three compressor stations, and approximately 45 miles of natural gas gathering pipelines in Lea and Eddy Counties, New Mexico.
On September 18, 2024, the company completed the Ameredev Acquisition, which included approximately 180 miles of gas gathering, water gathering, and oil transportation and gathering pipeline assets.
On December 18, 2024, the company completed the Pronto Transaction, pursuant to which it contributed Pronto, a wholly-owned subsidiary of the company, to San Mateo, and Five Point made a cash contribution to San Mateo.
Natural Gas Gathering and Processing Assets
The Black River Processing Plant and associated gathering system were originally built to support the company’s ongoing and future development efforts in the Rustler Breaks asset area and to provide the company with firm takeaway and processing services for its Rustler Breaks natural gas production. The company had previously completed the installation and testing of a 12-inch natural gas trunk line and associated gathering lines running throughout the length of the company’s Rustler Breaks acreage position, and these natural gas gathering lines are being used to gather almost all of its operated natural gas production at Rustler Breaks.
In 2020, San Mateo completed the construction and successful start-up of the expansion of the Black River Processing Plant to add an incremental designed inlet capacity of 200 MMcf of natural gas per day to the existing designed inlet capacity of 260 MMcf of natural gas per day, bringing the total designed inlet capacity to 460 MMcf of natural gas per day. The expanded Black River Processing Plant supports the company’s exploration and development activities in the Delaware Basin and, as of December 31, 2024, was also gathering and processing natural gas from the Stateline asset area and from the Greater Stebbins Area. The Black River Processing Plant also processes natural gas from the company’s Rustler Breaks asset area and provides natural gas processing services for other San Mateo customers in the area.
As of December 31, 2024, San Mateo had approximately 43 miles of large diameter natural gas gathering pipelines between the Black River Processing Plant and the Stateline asset area (approximately 24 miles) and the Greater Stebbins Area (approximately 19 miles). As of December 31, 2024, San Mateo was gathering or transporting almost all its operated natural gas production via pipeline in the Stateline asset area, the Greater Stebbins Area, the Rustler Breaks asset area, and the Wolf portion of its West Texas asset area.
In addition, as of December 31, 2024, San Mateo had NGL pipeline connections at the Black River Processing Plant to the NGL pipelines owned by EPIC Y-Grade Pipeline LP and Enterprise Products Partners L.P. These NGL connections provide several significant benefits to the company and other San Mateo customers compared to transporting NGLs by truck. San Mateo’s customers receive firm NGL takeaway out of the Delaware Basin, increased NGL recoveries, improved pricing realizations through lower transportation and fractionation costs, increased optionality through San Mateo’s ability to operate the Black River Processing Plant in ethane recovery mode, and a reliable alternative to pipe rather than to truck NGLs during severe weather events and otherwise.
As of December 31, 2024, San Mateo’s natural gas gathering systems included natural gas gathering pipelines and related compression and treating systems. During the year ended December 31, 2024, San Mateo gathered an average of approximately 426 MMcf of natural gas per day, an increase of 19% as compared to 358 MMcf of natural gas per day gathered during the year ended December 31, 2023. In addition, during the year ended December 31, 2024, San Mateo processed approximately 403 MMcf of natural gas per day at the Black River Processing Plant.
Crude Oil Gathering and Transportation Assets
San Mateo and Plains have entered into a strategic relationship to gather and transport crude oil for upstream producers in Eddy County, New Mexico, and have agreed to work together through a joint tariff arrangement and related transactions to offer producers located within a joint development area crude oil transportation services from the wellhead to Midland, Texas, with access to other end markets.
As of December 31, 2024, San Mateo had a crude oil gathering and transportation system in the Greater Stebbins Area that was connected to the existing interconnect in the Rustler Breaks asset area, totaling approximately 80 miles of various diameter crude oil pipelines and a crude oil gathering system in the Stateline asset area. With these oil gathering and transportation systems (collectively with the crude oil gathering and transportation system in the Rustler Breaks asset area and the crude oil gathering system in the West Texas asset area, the ‘San Mateo Oil Pipeline Systems’) in service, at December 31, 2024, the company estimated almost all of its oil production from the Stateline, West Texas, and Rustler Breaks asset areas and the Greater Stebbins Area was transported by pipeline.
As of December 31, 2024, the San Mateo Oil Pipeline Systems included crude oil gathering and transportation pipelines from points of origin in Eddy County, New Mexico, and Loving County, Texas, to interconnects with Plains and two trucking facilities. During the year ended December 31, 2024, the San Mateo Oil Pipeline Systems had throughput of approximately 52,600 Bbl of oil per day.
Produced Water Gathering and Disposal Assets
As of December 31, 2024, San Mateo had four commercial salt water disposal wells and associated facilities in the Greater Stebbins Area, nine commercial salt water disposal wells and associated facilities in the Rustler Breaks asset area, three commercial salt water disposal wells and associated facilities in the West Texas asset area, and produced water gathering systems in the Stateline, Rustler Breaks, and West Texas asset areas, and the Greater Stebbins Area. As of December 31, 2024, San Mateo had designed disposal capacity of approximately 475,000 Bbl of produced water per day.
During the year ended December 31, 2024, San Mateo handled approximately 462,400 Bbl of produced water per day.
South Texas / Northwest Louisiana
In South Texas, the company owns a natural gas gathering system that gathers natural gas production from certain of its operated Eagle Ford leases. In Northwest Louisiana, the company has midstream assets that gather natural gas from most of its operated leases. The company’s midstream assets in South Texas and Northwest Louisiana are not part of San Mateo as of December 31, 2024.
Marketing and Customers
The company’s crude oil is sold under both long-term and short-term oil purchase agreements with unaffiliated purchasers.
The company’s natural gas is sold under both long-term and short-term natural gas purchase agreements. Natural gas produced by the company is sold at various delivery points to both unaffiliated independent marketing companies and unaffiliated midstream companies.
Regulation
The company’s activities are subject to a variety of environmental laws and regulations, including the Oil Pollution Act of 1990 (the ‘OPA 90’), the Clean Water Act (the ‘CWA’), the Comprehensive Environmental Response, Compensation, and Liability Act (‘CERCLA’), the Resource Conservation and Recovery Act (‘RCRA’), the Clean Air Act (the ‘CAA’), and the Occupational Safety and Health Act (‘OSHA’), as well as comparable state statutes and regulations.
The company is subject to the requirements of OSHA and comparable state statutes. The OSHA Hazard Communication Standard, the ‘community right-to-know’ regulations under Title III of the federal Superfund Amendments and Reauthorization Act, and similar state statutes require the company to organize information about hazardous materials used, released, or produced in its operations.
History
The company, a Texas corporation, was founded in 2003 by Joseph Wm. Foran. The company was incorporated in 2003. The company was formerly known as Matador Holdco, Inc. and changed its name to Matador Resources Company in August 2011.
