Permian Basin Sees $100 Billion in Mergers and Acquisitions
The Permian basin, located between Texas and New Mexico, has witnessed a surge in mergers and acquisitions in the oil and gas industry, with a total value exceeding $100 billion this year alone. This record-breaking figure reflects the completion of several multi-billion dollar deals, according to global consultancy firm Wood Mackenzie, which released the news on Tuesday.
Major Deals Driving the Growth
Among the notable transactions contributing to this milestone are Exxon Mobil’s proposed $60 billion deal with Pioneer Natural Resources, as well as Chevron’s agreement to acquire Hess for $53 billion. Other deals include Permian Resources’ $4.5 billion bid for Earthstone Energy and Ovintiv’s $4.3 billion acquisition of three Permian Basin assets. Moreover, Civitas Resources spent a combined $4.7 billion on two private-equity owned properties in the Permian: Tap Rock Resources and Hibernia Energy III assets.
Why the Permian Basin is in High Demand
The Permian basin has attracted significant attention from oil and gas producers seeking to expand their reserves. With its highly productive shale oil output, plentiful untapped reserves, and robust infrastructure, the Permian basin presents an attractive opportunity for industry players. Wood Mackenzie cited Chevron, EOG, ExxonMobil, EQT, and ConocoPhillips as major producers in the basin, with Occidental’s recent purchase of CrownRock set to elevate their position to become one of the top three producers.
Occidental’s Growing Presence in the Permian Basin
WoodMac highlighted Occidental’s acquisition of CrownRock, announced just this week, as a significant development in the Permian basin. This strategic move will establish Occidental as the sixth producer, within the lower 48 U.S. states, boasting an impressive daily output of 1 million barrels of oil equivalent. Occidental’s presence will rival that of major players such as Chevron, EOG, ExxonMobil, EQT, and ConocoPhillips. In fact, Occidental is projected to surpass Pioneer’s production levels at the time of its sale announcement, propelling Occidental to a top-tier position in the Permian basin.