Exxon Mobil is poised to acquire Pioneer Natural Resources for approximately $60 billion, marking a significant move as it would position Exxon as the leading force in the largest U.S. oilfield and guarantee a decade of cost-efficient production, according to insiders.
This all-stock offer, which might exceed $250 per share for Pioneer, is the grandest takeover for Exxon since its $81 billion Mobil Oil procurement in 1998.
Despite Exxon’s silence on the speculation, the transaction is underlined by antitrust experts as potentially favorable.
They believe that both companies can present themselves as a minor fragment of the immense international oil and gas market, making regulatory approval more likely.
Over recent years, Exxon has remarkably rebounded from considerable losses and debt by implementing cost cuts, asset sales, and leveraging the elevated energy prices induced by geopolitical events like Russia’s invasion of Ukraine.
In defiance of external pressures to pivot towards renewable energy, Exxon’s CEO, Darren Woods, steadfastly adhered to a predominantly oil-centric strategy.
This strategy proved fruitful when Exxon reported an unprecedented $56 billion profit last year, a stark contrast from the $22 billion loss during the peak of the COVID-19 crisis.
Financial experts reveal that Exxon strategically reserved around $30 billion in cash from these profits, foreseeing future deal-making opportunities.
Pioneer, emerging as a titan from the shale revolution, transformed the U.S. from a dominant oil importer to the globe’s top producer in a mere decade.
It stands as the Permian basin’s third-largest oil producer, boasting minimal production expenses of roughly $10.50 per barrel.
Under the leadership of CEO Scott Sheffield, Pioneer expanded its influence with significant acquisitions, including those in 2021 involving DoublePoint Energy and Parsley Energy.
Exxon’s proposed acquisition of Pioneer would eclipse Shell’s 2016 acquisition of BG Group valued at $53 billion.
Earlier this year, Exxon had also finalized a $4.9 billion stock-based deal for Denbury Inc., a move designed to amplify its budding low-carbon segment.
After recovering from a 2020 slump, Exxon’s shares recently peaked at $120, demonstrating the company’s resilience and strategic foresight in the volatile oil and gas market.