ExxonMobil boosts fossil fuel commitment with Pioneer buyout
October 11, 2023
ExxonMobil has sealed a $59.5 billion (€56 billion) deal to acquire shale oil giant Pioneer Natural Resources, the companies announced on Wednesday, marking the oil giant's biggest acquisition since the late 1990s buyout of Mobil by Exxon.
The deal, valued at $253 a share, represents a 9% premium to Pioneer's average share price for the 30 days prior to October 5, when reports of discussions first surfaced.
It also demonstrates ExxonMobil's commitment to fossil fuels even as climate concerns become ever more pressing.
Exxon Mobil CEO Darren Woods said in an interview with CNBC that he thinks "oil and gas are going to continue to play a role over time" even "as the world looks to transition and find lower sources of affordable energy with lower emissions."
"That may diminish with time. The rate of that is ... not very clear at this stage. But it will be around for a long time."
ExxonMobil has long faced criticism that it intentionally promoted doubts about climate change science in order to protect its core business.
Merged company set to dominate key oilfield
Pioneer is the largest operator in the Permian Basin — a key US oilfield that straddles Texas and New Mexico.
Production in the Permian Basin accounts for a whopping 5.8 million barrels of oil per day, or about 45% of the nation's output.
Woods claims Pioneer's "highly contiguous" oilfield acreage would allow the merged company to drive down production costs.
The boards of both companies have approved the transaction, which is expected to close in the first half of next year, but it still needs approval from Pioneer shareholders.
"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.
zc/ab (AP, AFP, Reuters, dpa)