NEW YORK (The Deal) -- Excitement rippled through the oil patch last month on the news that Noble Energy (NBL) was purchasing Rosetta Resources (ROSE) for $3.9 billion and Diamondback Energy (FANG) picked up properties in West Texas from privately held Cobra Oil & Gas for $438 million. It looked like deals were raining down on the industry again after a long drought.
It was high time, as there are plenty of mid-sized players that would benefit from the economies of scale and access to capital that being part of a larger entity would provide, especially during a downturn like the industry is experiencing with lower oil and gas prices. And those deals gave nice valuations to the properties involved, a positive jolt after months of layoffs, idling of rigs and sliding share prices.
Global Hunter Securities wrote in a report Tuesday that there are four or five asset sale processes going on in West Texas' Midland and Delaware basins, and Natchez, Miss.-based Callon could be a buyer. None of the auctions are distressed situations: the sellers are looking to take advantage of the attractive valuations in the Noble/Rosetta and Diamondback transactions and Callon, led by Fred Callon, might consider picking up properties in the Delaware basin, a new area for the company.