Matador Resources Company (NYSE: MTDR) has completed the acquisition of Paloma Permian LLC, a portfolio company of EnCap Investments L.P., for a cash consideration of $1.255 billion. The transaction was finalized on October 1, 2026, following the execution of a Securities Purchase Agreement on July 22, 2026.
The acquisition involves the purchase of all issued and outstanding membership interests of Paloma Permian, LLC. The purchase price was subject to customary post-closing adjustments, including adjustments for working capital, title defects, and environmental defects. The target company owns proved undeveloped acreage and oil and natural gas producing properties located in Eddy and Lea Counties, New Mexico.
According to the company’s press release, the Paloma assets add approximately 16,500 net acres to Matador’s position, with the majority of the acreage held by production. The acquisition includes over 156 net drilling locations normalized to two-mile laterals across nine or more potential benches. Additionally, there are 59 approved drilling permits on the Paloma acreage.
Matador plans to commence drilling operations on up to 25 wells associated with the Paloma acreage by the end of 2027. The company noted that production from the acquired wells has outperformed underwriting estimates by approximately 10% since June 1, 2026, largely due to the performance of Paloma’s newest wells in Eddy County.
Matador expects the Paloma Acquisition to be integrated efficiently into its operating plans. The company anticipates that the transaction, combined with the recently announced Ridge Runner Resources II acquisition, will increase its net acreage position in the core of the Delaware Basin to approximately 240,000 acres by the fourth quarter of 2026. This represents an increase of almost 20% compared to its October 2025 position of 203,000 net acres.
Regarding financial impacts, Matador expects to pay down its reserves-based lending credit facility led by PNC Bank by approximately $350 million to $400 million in the fourth quarter of 2026, depending on commodity prices. Legal advisors for the transaction included Baker Botts L.L.P. for Matador and Vinson & Elkins LLP for Paloma and EnCap.
