Vitol Divests US Upstream Business VTX Energy Partners to Verde

Global energy and commodities trader Vitol has reached an agreement to sell its US upstream asset, VTX Energy Partners, LLC, to Verde Operating Company, LLC. According to a statement published by Vitol, the financial terms of the deal were not disclosed, and completion remains subject to customary conditions precedent.

VTX Energy Partners was established in 2022 as a joint venture between Vitol and the former management team of ATX, led by Gene Shepherd and Erik Hoover. According to reporting by Vitol, the operating company currently generates a total output of 60,000 barrels of oil equivalent a day. The firm's operational footprint spans acreage located across Reeves and Pecos counties in the southern Delaware Basin region of Texas.

The acquisition by Verde Operating Company will be backed by equity commitments from funds managed by private equity firms Carnelian Energy Capital Management, L.P. and EnCap Investments L.P. Additional equity financing is being provided by Chief Capital, HF Capital, Formentera Partners, management, and a group of co-investors. Debt financing to back the transaction will involve a new reserves-based credit facility, with syndication led by Wells Fargo Securities, LLC and BofA Securities, Inc.

Ben Marshall, head of Americas for Vitol, commended the VTX leadership and operational staff for their professionalism and capital discipline throughout the asset's development. Gene Shepherd also noted his appreciation for Vitol's support in expanding VTX and expressed optimism for the upstream producer's next phase of growth following its acquisition by Verde.

Several corporate advisors were retained to execute the transaction. Vitol engaged Goldman Sachs & Co. LLC as its financial advisor, while Kirkland & Ellis LLP served as legal counsel. Verde was advised on legal matters by Gibson, Dunn & Crutcher LLP. Lead financial advisory services for Verde were provided by Morgan Stanley & Co. LLC, with TPH&Co., the energy division of Perella Weinberg Partners, also acting as a financial advisor on the acquisition.