A capital markets innovation that changes the game for Permian E&P’s
Liquidity, Transparency, Efficiency
SLU is a financial marketplace that creates and exposes a standardized, tradeable security created by combining future cash flows of Permian Basin acreage with a development plan and a rating
The Permian Basin has been the most important resource base in the world for nearly a decade, but its historical sources of capital have gone missing. By combining Permian Basin Operating Expertise with strict Non-Venting governance, the SLU Marketplace brings Direct Investment opportunities for investors eager to add positive impact.
Leading Permian E&P ́s have agreed to participate to the SLU Marketplace and are enrolling assets in the ledger to catalyze market liquidity.
relevant • transparent • simple
Establishment of a New Asset Class
- Starting point – a 1280 acre double section parcel
- Creation of an LLC called Super Location Entity (SLE), using the standardized JOA and a development plan provided by the Prime Operator
- Rating of the SLE by Ryder Scott, which determines the technically recoverable volume of the Super Location, and provides a quality and commerciality grade of each formation.
- Listing – After the WI are swapped for units in the SLE, the SLE is listed on the SLU Marketplace along with associated formation, development start dates and ratings.
- Offer Submissions – Armed with the security of standardization, and the transparency from the rating, the new investor base submits offers for any size portions of the SLE
The simplification brought by the standardization,
and the transparency from the rating will:
1. Expose the tremendous value of undeveloped Permian Acreage
2. Bring more capital to the basin – generating drilling capital
3. Enable operational excellence
Value Discovery for Both Sides of the Bridge
- New arrow-in-the-quiver of their efforts to manage long-dated inventory portfolios
- Price discovery
- Empowerment of responsible managers within E&Ps
- Assets rated as non-venting will attract higher premiums in the Marketplace, compared to those that do not meet the specifications