A joint venture between private equity firm Bayou City Energy and energy producer Mach Resources submitted the winning bid in a Texas bankruptcy court last week for the assets of Alta Mesa Resources and its subsidiary Kingfi sher Midstream.

The BCE-Mach III partnership was selected as the winning bidder at a Chapter 11 auction with a $320 million bid, adding $10 million to a previous offer, according to an article in the Wall Street Journal.

The bid includes $232 million for the assets of Alta Mesa Holdings, Alta Mesa Finance Services Corp, Alta Mesa Services and Oklahoma Energy Acquisitions and $88 million for the assets of Kingfi sher Midstream, Oklahoma Produced Water Solutions, Kingfi sher STACK Oil Pipeline and Cimarron Express Pipeline, according to amended sales agreement filed in the bankruptcy case.

According to bankruptcy court fi lings, “a number of challenges” led Alta Mesa and Kingfi sher Midstream to seek bankruptcy.

“Principal among these challenges is volatility and sustained decreases in oil and natural gas prices,” according to court documents.

As of Dec. 31, 2018, Alta Mesa had a 66% average working interest in 1,153 gross producing wells and had assembled approximately 130,000 net acres in the STACK, primarily in eastern Kingfisher County and Major County, according to court documents.

As of that date, Alta Mesa estimated its total proved reserves at approximately 69.1 million barrels of oil equivalent, of which approximately 65% was oil and natural gas liquid reserves and 35% were natural gas reserves.

Since last March, Alta Mesa had been operating two rigs in the STACK, both of which had been deactivated as of September, according to its bankruptcy fi lings.

Kingfisher Midstream has natural gas gathering and processing and crude oil gathering and storage assets and also purchased water gathering, pipelines, facilities, disposal wells and surface leases and easements from Alta Mesa in November 2018, according to bankruptcy fi lings.

Approximately 80-90% of Kingfisher Midstream’s revenue is derived from longterm crude oil, gas and water gathering agreements with Oklahoma Energy Acquisition LP, another subsidiary of Alta Mesa.

Before the sale is permitted to close, it must be approved by the Houston bankruptcy court. Creditors have fi led objections to the sale, according to court documents.

Oklahoma City-based Mach Resources was founded in 2017 by Tom Ward, cofounder of Chesapeake Energy Corp.