Acquisition, Divestiture and Nonmonetary Activities

3 Months Ended

Mar. 31, 2023

Business Combinations [Abstract]

Acquisition, Divestiture and Nonmonetary Activities

Acquisition, Divestiture and Nonmonetary Activities

Acquisitions. The Company regularly seeks to acquire or trade for acreage that complements its operations, provides exploration and development opportunities, increases the lateral length of future horizontal wells and provides superior returns on investment.

Divestitures. The Company regularly reviews its asset base to identify nonstrategic assets, the disposition of which would increase capital resources available for other activities, create organizational and operational efficiencies and further the Company's objective of maintaining a strong balance sheet to ensure financial flexibility.

•During the three months ended March 31, 2022, the Company divested certain undeveloped acreage and producing wells in the Midland Basin for (i) cash proceeds of $85 million and (ii) ownership interests in certain Midland Basin undeveloped acreage and producing wells valued at $8 million. The Company recorded a gain on these sales of $41 million, which is reflected in net gain on disposition of assets in the consolidated statements of operations.

•In February 2022, the Company completed the sale of its equity interest in certain gas gathering and processing systems in northern Martin County for cash proceeds of $125 million (the "Martin County Gas Processing Divestiture"). The sale was treated as a recovery of investment from a partial sale of proved property resulting in no gain or loss being recognized.

Nonmonetary transactions. During the three months ended March 31, 2023, the Company's nonmonetary transactions included exchanges of both proved and unproved oil and gas properties in the Midland Basin with unaffiliated third parties. Certain of these transactions were accounted for at fair value, resulting in the Company recording a gain of $24 million to net gain on disposition of assets in the consolidated statements of operations and $162 million of noncash investing activities.