As per the terms, FANG inked a 15-year dedication to producing and supplying water in a 12-county area of mutual interest in the Midland Basin. 

FANG, which will have a 30% stake in Deep Blue, received upfront cash proceeds of around $500 million, with potential for more through performance-based earnouts over the next 24 months. 

Apart from this, FANG and Five Point Energy expect to collectively contribute $500 million in follow-on equity capital to fund future projects and acquisitions.

Deep Blue also executed long-term acreage dedications with two investment-grade customers, totaling over 20,000 acres with expected produced water volumes of over 75,000 barrels per day during 2024.

Price Action: FANG shares are trading lower by 2.25% at $152.52 on the last check Monday.