Magnolia Oil & Gas Corp. has sold non-core assets in Dimmit and Zavala counties, Tex., for $47.5 million plus 616 net acres in Gonzales County, lifting its average operated working interest to 98% in a consolidated Karnes-area acreage block.

The Houston-based company completed the transaction in this year's third quarter. The divested assets produced about 1,400 boe/d (84% oil) on a next-12-month basis, Magnolia disclosed in an operational update issued after the recent closing of its acquisition of WildFire Energy.

The received Gonzales County acreage sits within a largely undeveloped Karnes-Gonzales position that Magnolia assembled through bolt-on acquisitions with private operators earlier this year.

How does the deal fit Magnolia's Karnes buildout?

In first-quarter 2026, Magnolia acquired roughly 6,200 net acres across its Karnos-area and Giddings positions for about $155 million. Those Karnes acquisitions created a largely contiguous 10,000-acre block of primarily undeveloped acreage spanning Karnes and Gonzales counties.

The latest swap trims the perimeter and consolidates control. Average operated working interest in the consolidated Karnes block now stands at 98%.

Chris Stavros, Magnolia's chairman, president, and chief executive officer, said integration of the WildFire assets is progressing as planned as the company works to build a larger Eagle Ford and Austin Chalk position across South Texas.

What does the production outlook show?

Third-quarter 2026 production is expected to average 116,000-118,000 boe/d, about 42% oil. That range reflects both the WildFire acquisition and the impact of the divested properties, Magnolia said.

Fourth-quarter 2026 — the first full quarter carrying the WildFire volumes — is forecast at 159,000-161,000 boe/d, with oil accounting for 49-50% of output.

Capital spending follows the volume step-up:

• Third-quarter 2026 drilling and completion (D&C) spend: $155-165 million
• Fourth-quarter 2026 D&C spend: about $235 million
• Estimated 2027 D&C spend: $900-950 million, including modest oilfield service cost inflation

What is the 2027 growth target?

For 2027, Magnolia expects both oil and total production to grow 4-5% from a second-quarter 2026 pro forma base of about 78,000 b/d of oil and 158,000 boe/d total, after accounting for volumes tied to the asset sale.

The guidance anchors the company's post-WildFire trajectory: a consolidated Karnes core at near-full working interest, an expanding Giddings and Austin Chalk position, and a capital program sized below $1 billion for the year.

The watch item is fourth-quarter 2026 delivery — whether the first full WildFire quarter holds the 159,000-161,000 boe/d range at the guided $235 million D&C outlay, and whether service cost inflation stays modest into the 2027 program.