Law360 featured comments from Partner John P. Melko, chair of the Firm’s financial restructuring and reorganization practice, regarding the uptick in oil and gas deals concentrated in the Permian Basin. According to the publication, the drilling costs in the West Texas region are among the cheapest in the U.S.
“If you have a lease in the Permian and you have deep [mineral] rights, as well as shallow rights, you might be able to produce for multiple horizons with that lease,” said Mr. Melko.
The publication also added that while many operators in the region have been protected by bankruptcies affecting the rest of the industry, creditors of Permian drillers who have gotten into bankruptcy trouble are in a favorable position. “If they've got the staying power, it makes good sense for them,” said Mr. Melko.
Subscribers can access the full article here.