Pioneer Natural Resources Company has announced its plans to merge with ExxonMobil in a deal worth $65 billion. The all-stock transaction is expected to generate double-digit returns and create a leading high-quality undeveloped U.S. unconventional inventory position, strengthening the country's economy and energy security.
In a Facebook post on October 11th, Pioneer stated, "Combining our sizeable acreage, entrepreneurial culture and deep industry expertise with ExxonMobil's balance-sheet strength, advanced technologies and industry-leading project execution capabilities is expected to generate double-digit returns by recovering more resource, more efficiently and with a lower environmental impact."
The merger will combine Pioneer's more than 850,000 net acres in the Midland Basin with ExxonMobil's 570,000 net acres in the Delaware and Midland Basins. This will create a significant inventory position and make Exxon the largest single player in the Permian Basin.
ExxonMobil Chairman and CEO, Darren Woods, praised Pioneer's leadership in the Permian and highlighted the benefits of the merger. "The combined capabilities of our two companies will provide long-term value creation well in excess of what either company is capable of doing on a standalone basis. 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. As importantly, as we look to combine our companies, we bring together environmental best-practices that will lower our environmental footprint and plan to accelerate Pioneer's net-zero plan from 2050 to 2035," Woods said.
The deal is expected to close in early 2024, according to Odessa NBC affiliate KWES News. Once completed, it will solidify Exxon's position in the Permian Basin and pave the way for increased production and economic growth in the region.