Forbes Piece: US Oil Business Posts Record Merger Action In 4th Quarter

The U.S. oil and gas industry set new records for mergers and acquisitions activity during the 4th quarter of 2023, according to a new report from energy advisory firm Enverus. Deals in the upstream sector of the business totaled to $144 billion for the quarter, a level of monetary value not seen since the flurry of mergers among major oil companies at the end of the 1990s that resulted in the creation of current supermajors like ChevronTexaco (now Chevron), BP-Amoco (now BP), and ExxonMobil.

In a release, Enverus senior vice president Andrew Dittmar said, “After a decade of lowered investment in exploration and with the major U.S. shale plays largely defined, M&A has become the preferred tool to replace declining reserves and secure longevity in these companies’ profitable upstream businesses. For the best quality resource, there are also now more buyers than sellers, driving prices upward.”

The biggest transaction during the quarter was the $65 billion buyout of Permian Basin pure-play independent Pioneer Natural Resources by ExxonMobil in a deal that had long been rumored since at least 2017, when I first wrote about it. Almost as big was the buyout of Houston-based international independent Hess Corp. by Chevron in a deal with a total value, including assumed debt, of almost $60 billion.