stockrowWhat it does
Matador Resources is an independent energy company that explores for, develops, produces and acquires oil and natural gas resources in the United States. Its operations focus on shale and other unconventional formations, principally the Wolfcamp and Bone Spring formations in the Delaware Basin of Southeast New Mexico and West Texas. It also produces oil and gas in Northwest Louisiana. Joseph Wm. Foran founded Matador in 2003 and is its chairman and chief executive.
Matador drills wells to bring oil and natural gas to the surface and sells the production to purchasers. It operates many of its own wells and also owns interests in wells operated by other companies. Some natural gas is processed to extract natural gas liquids, which can also be sold. Crude oil and gas are sold under both short-term and long-term purchase agreements.
The company also runs a midstream business: infrastructure that gathers, processes, transports and handles materials produced at wells. Its systems support Matador’s own production and provide services to other producers. These services include natural gas processing, oil transportation, gathering oil, gas and produced water, and disposing of produced water. Matador conducts most of this business through San Mateo, a joint venture in which it holds a 51% interest. In 2026, Matador said it had integrated the Cardinal acquisition into the San Mateo system.
How it makes money
Matador earns revenue from producing and selling oil, natural gas and natural gas liquids, as well as from midstream services and sales of purchased natural gas. Its exploration and production business develops wells and sells their output; its midstream business handles production for Matador and other producers. For 2025, oil and natural gas revenues were $3.24 billion.
Crude oil is sold under purchase agreements with unaffiliated buyers, with prices based on published field prices. Those prices move with the oil market, and transportation costs are generally deducted from the amount Matador receives. Natural gas is sold at various delivery points to independent marketing and midstream companies, with prices based on pipeline indices. Where gas is processed to extract liquids, payment for those liquids depends on negotiated arrangements and market prices, less applicable processing, transportation and fractionation fees.
For 2025, natural gas revenue was $398.6 million. Production from existing wells provides ongoing sales, while Matador continues drilling and completing wells to develop its acreage.
San Mateo’s gathering, processing, transportation and water-disposal systems serve both Matador and third parties. Third-party midstream services generated $164.7 million in revenue in 2025. Matador said in 2026 that its gas sales had moved away from Waha to the Hugh Brinson system. It also said the Cardinal acquisition added 9 new third-party customers to San Mateo.
| Product or service | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Crude Oil, Condensate, and Natural Gas Liquids (NGL) | $2.8 billion | 77.7% | 2.45% |
| Natural gas revenues | $398.6 million | 10.9% | 7.30% |
| Sales of purchased natural gas | $253.0 million | 6.92% | 30.4% |
| Third-party midstream services revenues | $164.7 million | 4.51% | 16.8% |
Customers and how it sells
Matador’s production and midstream operations are in the United States. Its main area is the Delaware Basin in Southeast New Mexico and West Texas, where its properties include acreage in Lea and Eddy Counties, New Mexico, and Loving, Ward and Winkler Counties, Texas. It also has production in the Haynesville shale and Cotton Valley formations in Northwest Louisiana.
The company sells crude oil to unaffiliated purchasers under short-term and long-term agreements. Its natural gas customers include independent marketing companies and midstream companies that take delivery at various points. San Mateo provides gathering, processing, transportation and water-handling services to third-party producers as well as supporting Matador’s operations.
For 2025, three significant purchasers accounted for approximately 72% of Matador’s total oil, natural gas and natural gas liquids revenues. Plains Marketing, L.P. accounted for 49.0% of revenue, Exxon Mobil Corporate for 13.0%, and Enterprise for 10.0%. Matador also has a joint development area with Plains Marketing to gather oil produced by Matador and other producers in Eddy County, New Mexico.
At December 31, 2025, approximately 99% of Matador’s estimated proved oil and gas reserves were attributable to the Delaware Basin. Matador said the Cardinal acquisition brought 9 new third-party customers to the San Mateo system in 2026.
Suppliers and costs
Matador’s principal spending includes acquiring and developing oil and gas properties, drilling and completing wells, and building and maintaining midstream facilities. Its drilling, completion and equipping capital expenditures were $1.53 billion in 2025. The company uses service providers and equipment to drill, complete and operate wells, and it monitors their performance as part of managing costs.
Matador said in 2026 that its contracts with Patterson covered all of its rigs. It also said BNL Pipe Co. had helped ensure that pipe was available when needed. The company has experienced inflation in oilfield services, materials and equipment, including diesel, steel, labor, trucking and sand. Supply-chain disruptions, tariffs and trade restrictions can affect its ability to obtain products and services on a timely and cost-effective basis.
San Mateo’s system includes processing plants, gathering pipelines and produced-water disposal wells. Matador also pays transportation and processing-related charges associated with getting production to market. Its oil and gas and midstream operations are subject to federal, state and local requirements that increase the cost of doing business.
- Revenue$3.7B
- Cost of revenue−$371.2M
- Selling, general and administrative−$412.7M
- Other operating costs−$1.7B
- Operating income$1.2B
Competitive position
Matador competes with major and independent oil and gas companies for exploration and development opportunities, acreage acquisitions, drilling rigs, equipment and labor. Its midstream business competes with public and private companies for natural gas gathering and processing, produced-water gathering and disposal, and oil gathering and transportation. Competition for midstream customers depends on facility location, reputation, reliability and pricing.
Matador says many competitors have greater financial resources, staff and facilities. Larger competitors may be able to pay more for acreage, producing properties, rigs or midstream facilities. The company also says competing midstream operators may have established relationships with producers and longer operating histories. No individual competitor is named in the available company material.
Matador’s Delaware Basin acreage includes multiple potential drilling targets, and the company says concentrating its operations in core areas helps it achieve economies of scale and reduce operating costs. At December 31, 2025, it had approximately 354,600 gross (212,500 net) acres in the basin. Our reading: the acreage position and operating experience provide a basis for repeated development, but they do not remove competition for properties and services.
San Mateo’s pipelines, processing plants and water facilities support Matador’s own production and serve other producers. Matador says control of midstream capacity helps it get gas to market. Our reading: these facilities offer an operational advantage where they connect wells to markets, but the advantage is limited by competing systems, pricing and producers’ existing relationships.
Growth opportunities
Matador’s growth plans center on developing its Delaware Basin acreage, identifying additional drilling locations, pursuing acquisitions and expanding midstream services. It also seeks to improve drilling and completion efficiency, including through longer horizontal wells and batch developments.
Average daily oil equivalent production was 207,070 BOE per day in 2025, an increase of 21% from 2024. Matador attributed the increase primarily to development drilling in the Delaware Basin. At December 31, 2025, it had identified 5,295 gross (1,802 net) engineered locations for potential future drilling in the basin. These locations are estimates of potential wells, not wells already producing.
San Mateo expanded its Marlan gas processing plant in 2025, increasing the joint venture’s total designed natural gas cryogenic processing capacity to 720 MMcf per day. In 2026, Matador said it had integrated Cardinal into San Mateo and was adding connectors to its system. It also said it had shifted gas sales away from Waha to the Hugh Brinson system.
Matador has acquired additional acreage and continues to explore new formations. In 2026, it said its Woodford well had produced over 140 thousand barrels in just over 5 months. The company expects up to 25 wells on acreage associated with Paloma over the next year and 10-12 additional wells on associated federal lease sale acreage. Drilling plans and results remain subject to operational and market conditions.
- $1.7BFY2021
- $3.1BFY2022
- $2.8BFY2023
- $3.5BFY2024
- $3.7BFY2025
Structural risks
- Commodity prices: Matador’s oil, natural gas and natural gas liquids prices fluctuate with supply, demand and other market conditions. Lower prices can reduce revenue, cash flow, profitability and the carrying value of reserves. Production may also sell at a discount to benchmark prices.
- Capital and financing: Exploration, development and midstream projects require substantial capital. Cash flow and available borrowing may not cover future spending, debt service and dividends, and additional financing may not be available on satisfactory terms.
- Geographic concentration: At December 31, 2025, approximately 99% of estimated proved reserves were in the Delaware Basin. Pipeline capacity problems, production interruptions or other local disruptions can affect Matador’s ability to sell production.
- Regulation and permits: Approximately 33% of Matador’s leasehold and mineral acres in the Delaware Basin is on federal lands. Permitting requirements, regulatory changes and legal challenges can delay or restrict development.
- Operating and customer risk: Drilling and production involve operational and financial uncertainty. Three significant purchasers accounted for approximately 72% of oil, natural gas and natural gas liquids revenues in 2025; losing purchasers without finding acceptable alternatives could adversely affect the business.
Bottom line
Our reading
Our reading: Matador combines a Delaware Basin oil and gas producer with a midstream network that supports its own wells and earns revenue from other producers. Its acreage and infrastructure provide routes for further development, but the business remains exposed to commodity prices, capital needs and disruptions in its concentrated operating area. Customer concentration and the need for permits add to those dependencies.