Exxon Mobil buying Pioneer Natural Resources in $59.5 billion deal

Fox 26 Houston ^ | 10/11/2023 | Michelle Chapman

[texas booster]

Exxon Mobil is buying Pioneer Natural Resources in an all-stock deal valued at $59.5 billion, its largest buyout since acquiring Mobil two decades ago, creating a colossal fracking operator in West Texas.

Including debt, Exxon is committing about $64.5 billion to the acquisition, leaving no doubt of the Texas energy company’s commitment to fossil fuels as energy prices surge.

Pioneer shareholders will receive 2.32 shares of Exxon for each Pioneer share they own.

Exxon purchased XTO Energy in 2009 for approximately $36 billion. In the late 1990s, the merger between Exxon and Mobil was valued around $80 billion.

The deal with Pioneer Natural expands Exxon’s presence in the Permian basin, a massive oilfield that straddles the border between Texas and New Mexico. Drilling the Permian accounted for 18% of all U.S. natural gas production last year, according to the U.S. Energy Information Administration.

[texas booster]

Pioneer’s more than 850,000 net acres in the Midland Basin will be combined with Exxon’s 570,000 net acres in the Delaware and Midland Basin, nearly contiguous fields that will allow the combined company to trim costs.

...

Natural gas rigs in operation have declined over 26% in the U.S. since the start of the year, according to government data, largely due to the rising costs for drilling materials and labor over the past two years.

"Their tier-one acreage is highly contiguous, allowing for greater opportunities to deploy our technologies, delivering operating and capital efficiency as well as significantly increasing production," Exxon Mobil CEO Darren Woods said of Pioneer in a prepared statement.

[texas booster]

Texas Ping, the Best State in the USA!

A ping out to the Texas Ping list, founded by Windflier.

"The combination of ExxonMobil and Pioneer creates a diversified energy company with the largest footprint of high-return wells in the Permian Basin, Pioneer CEO Scott Sheffield said in a prepared statement.

Citi’s Alastair Syme wrote that the transaction could provide multiple benefits to Exxon.

"Across the industry, the logic of consolidation in the highly fragmented Permian shale remains compelling with significant gains to be achieved from economies of scale by minimizing facilities spend, optimizing drilling and reducing" general spending, Syme wrote.

Exxon is flush with cash. The company posted unprecedented profits last year of $55.7 billion, breezing past its previous record of $45.22 billion in 2008 when oil prices hit record highs.

Good for Exxon, using its cash from fossil fuel sales by enviroweenies to buy out competitors and reduce operational expenses.

This ping may mean more to some that live in Texas than others ;)

Another special Texas Fall edition for your perusal.

As always, please FReepmail me if you want on or off the Texas Ping list.

Blessings, and stay cool!

[EEGator]

That’s the first time in a while I have heard a statement from a CEO that was intelligent, non political, and logical.

[EEGator]

Is this around the Odessa area?

[EERinOK]

Yes. Odessa and Midland

[texas booster]

Yes they have acreage from Abilene all the way to the big city of Orla TX. With a small stretch into NM.

[EEGator]

Thanks. I was stationed at Goodfellow AFB about 130 mi ESE of there.
I knew some guys in the energy sector who moved out that way.

[smokingfrog]

The merged company could add 700,000 barrels per day of oil and gas (boepd) production within four years of the deal closing, to 2 million boepd. It also aims to cut greenhouse gas emissions and increase oil output per well by combining Exxon technology with Pioneer’s lower cost of operations, Exxon said.

https://www.reuters.com/markets/deals/exxon-talks-pay-over-250-per-share-pioneer-bloomberg-news-2023-10-11/

[texas booster]

Pioneer also owns Targa Pipeline ... integrates well into Exxon’s pipeline system.

There is also a JV with a Sino oil company ... should be interesting to watch.

[smokingfrog]

Seems like an excellent deal for Exxon.

[algore]

https://www.ft.com/content/df2dd633-c771-4e1c-99b3-315470de9841

Exxon guy in charge of the merger was arrested the other day for banging two prostitutes at the la quinta inn.

[djstex]

Thanks for the ping.

[Cletus.D.Yokel]

Wolfcamp

[LastDayz]

Apparently, he was in a celebratory mood and releasing his pent up frustrations. I can only imagine the stress levels putting that deal together.

[LastDayz]

Gotta wonder what % of energy production is now controlled by Exxon within the state.