Exxon Mobil Closing In on Megadeal With Shale Driller Pioneer
“With a tree, all the growth takes place at the growing tips.”
Introduction
Exxon Mobil Corp. is nearing a deal worth as much as $60 billion to buy shale-focused Pioneer Natural Resources Co., the Wall Street Journal reported, citing unidentified people familiar with the matter.
A deal could be completed in the coming days provided there are no complications, according to the newspaper.
Exxon Mobil near $60 billion deal to buy Pioneer
Exxon “does not comment on market rumors,” the company said in a response to a Bloomberg request for comment. Pioneer didn’t immediately respond to a request for comment.
Any deal would likely reshape the US oil landscape and be Exxon’s largest acquisition since its 1999 takeover of Mobil Corp. Pioneer is one of the dominant independent explorers in the prolific Permian Basin oil field.
Attention has been focused on the future of Pioneer since Chief Executive Officer Scott Sheffield, an architect of the shale boom that made the US an oil powerhouse, said in April he planned to retire at year’s end.
Exxon this year agreed to a $4.9 billion deal, its largest in six years, to acquire Denbury Inc. and add a network of carbon dioxide pipelines in the US. Chief Executive Officer Darren Woods told investors in July the company would be “picky” as it continued to examine acquisitions.
Exxon Mobil is closing in on a megamerger with shale driller Pioneer. This would be Exxon’s largest deal since its merger with Mobil in 1999. The deal would give Exxon a dominant position in the Permian Basin, the most productive oil field in the United States.
The deal is expected to be met with mixed reactions. Some analysts believe that it is a good move for Exxon, as it will give the company a stronger foothold in the shale market. Others are concerned that the deal will create a monopoly in the Permian Basin.
It is still too early to say what the long-term impact of the deal will be. However, it is clear that it will be a major shakeup in the oil and gas industry.
Here are some of the potential benefits and drawbacks of the deal:
Potential benefits:
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Exxon would gain access to Pioneer’s vast reserves in the Permian Basin.
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Exxon would be able to reduce costs by combining operations with Pioneer.
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Exxon would be able to increase its production and market share.
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Pioneer shareholders would receive a premium for their shares.
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Potential drawbacks:
The deal could create a monopoly in the Permian Basin, which could lead to higher prices for consumers.
The deal could lead to job losses, as Exxon and Pioneer combine operations.
The deal could distract Exxon from investing in renewable energy.
Conclusion
Overall, the deal is a complex one with both potential benefits and drawbacks. It will be important to monitor the deal closely to see how it impacts the oil and gas industry and consumers.
