Concho Resources: An Independent Oil and Natural Gas Company

One of the independent oil and natural gas companies that operate in the Permian Basin is Concho Resources. The company’s primary operating areas lie in the West Texas regions and the southeast locations of New Mexico. The business was formed in 2006 as a result of the merger between Concho Equity Holdings Corp and some of the oil and gas properties of Chase Oil Corporation.

Concho Equity Holdings Corp. was created two years before the merger and the company is considered to be the third business to focus its operations on the Permian Basin since 1997. The first year of the company was spent acquiring oil and natural gas properties and was successful in taking over the business of Lowe Partners, LP for about $117 million. The business continues to expand its operations by acquiring and developing other companies that are in the exploration of oil and natural gas business.

With a capital budget of more than $1.8 billion, the business produces more than 33.6 million barrels of oil equivalent. It continues to grow its production and increases its crude oil delivery by 25% year after year. In 2013, they have reported to have doubled their drilling operations and has identified over 22,000 locations with more than 502.9 million barrels of oil equivalent in estimated proved reserves. The expansion of its operations was strongly attributed to its successful takeover of Three Rivers Operating Company in 2012. With this acquisition, they have added to their core operations locations in Midland Basin Wolfberry play and the Midland Basin horizontal Wolfcamp play.

The business strategy of the company relies heavily on the acquisition of properties, especially those that are located in prolific oil plays in the country. Through this method of approaching the trade, they are not only able to increase their reserves; they are also able to secure strong production and cash flow for their stockholders and business partners.