Matador Expands Delaware Basin Footprint with $1.275 Billion Paloma Acquisition and Woodford Breakthrough
Event summary
- Matador acquires Paloma Permian for $1.275 billion, adding 16,235 net undeveloped acres and 11,100 BOE/d of production in Southeast New Mexico.
- Ridge Runner acquisition expands Woodford position to ~50,000 contiguous net acres at $4,000 per acre.
- Rae’s Creek well in Woodford formation tests at 2,200 BOE/d (72% oil), validating commercial viability.
- Deals funded via cash and RBL credit facility, with expected $1 billion adjusted free cash flow for 2026.
The big picture
Matador’s dual acquisitions represent a strategic consolidation play in the Delaware Basin, where contiguous acreage positions are increasingly valuable. The Woodford breakthrough adds an emerging play layer to their core Bone Spring/Wolfcamp focus, while the Paloma deal expands high-margin inventory. Both moves align with industry trends toward scale and operational efficiency in mature basins.
What we're watching
- Execution Risk
- Whether Matador can integrate acquisitions efficiently and reduce Woodford well costs by 30-40% within 18 months.
- Commercial Viability
- How the Rae’s Creek results will translate to broader Woodford development success.
- Financial Strategy
- The pace at which Matador can repay acquisition debt and return leverage ratio to 1.0x.
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