XCL Resources Seeks $1B Acquisition of Altamont Energy, FTC Review Pending
Houston-based private equity firm XCL Resources has filed for the acquisition of Utah's Altamont Energy, LLC through its subsidiary XCL Resources Holdings, LLC. The deal, valued at over $1 billion, is subject to Federal Trade Commission (FTC) approval following a public comment period.
XCL, a private equity-owned oil and gas company, operates in Duchesne and Uinta Counties, Utah. It extracts black and yellow waxy crude oil and natural gas in the region. The firm has invested over $1 billion in energy assets worldwide and is backed by EnCap Investments, which has raised more than $40 billion in funds.
Altamont Energy, LLC, the target company, is an oil and gas operator in the Uinta Basin region of Utah. The acquisition, if approved, will add to XCL's portfolio of energy assets. However, the deal is not without scrutiny. The FTC is seeking public comment on the application, following a 2022 final order regarding EnCap's acquisition of EP Energy Corp. The order requires XCL and EnCap to obtain FTC approval before acquiring any other producer of waxy crude oil with an output of more than 2,000 barrels per day in specific Utah counties.
Private equity firms' involvement in the oil and gas industry has been significant. Since 2010, they have invested around $1.1 trillion into energy assets globally. However, many firms struggled in the late 2010s, with nearly 60 percent of oil and gas companies that filed for bankruptcy in 2020 being backed by private equity firms. These firms constituted 82% of the debt owed.
The acquisition of Altamont Energy, LLC by XCL Resources, if approved, will expand XCL's operations in Utah. The FTC's review process, including public comment, will determine the fate of this deal. This acquisition, like others involving private equity firms in the oil and gas industry, will have significant implications for the region's energy landscape.
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