BATTALION OIL CORP 8-K

What Happened
Battalion Oil Corporation announced on December 18, 2025 that certain subsidiaries entered into a Sale Agreement with MCM Delaware Resources, LLC to divest substantially all oil and natural gas properties and related assets in the West Quito Draw area (Ward County, Texas). The agreed purchase price is approximately $62.59 million, with an effective date of December 1, 2025, and the company expects the transaction to close in the first quarter of 2026.

Key Details

• Sale covers ~6,207 net acres in Ward County, Texas; proved reserves from these properties were ~8 MMBoe, about 12.4% of Battalion’s 2024 year-end proved reserves.
• Buyer paid an escrow deposit of approximately $6.26 million, which will apply to the purchase price if the deal closes.
• Purchase price is subject to customary adjustments for operating expenses, capital expenditures and revenues between the effective date and closing, title/casualty/environmental defects, and other customary adjustments.
• The parties may terminate the agreement if price adjustments exceed 20% (~$12.52 million) or if the transaction has not closed by March 26, 2026. TenOaks Energy Advisors is serving as Battalion’s financial advisor.

Why It Matters
The proposed divestiture would monetize a meaningful portion of Battalion’s proved reserves (~12.4%) and provide cash the company intends to use to repay amounts under its Senior Secured Credit Agreement and for general corporate purposes (including potential acquisitions and planned drilling). For investors, the transaction could reduce near-term debt and free up capital, but closing is subject to customary conditions and price adjustments — there is no guarantee the sale will complete on the stated terms or timeline.