The flurry of consolidation amongst operators in the shale patch that began last year is continuing in 2024 as well. Mergers and acquisitions (M&A) activity has been particularly brisk, with deals varying in size and scope. For instance, Chevron acquired PDC Energy exactly a year ago for $7.6 billion and followed up with an offer for Hess in a $53 billion deal in October. ExxonMobil made two acquisitions – Denbury Resources and Pioneer Natural Resources – as well last year albeit for different reasons.
Shale and E&P independents have also been prolific with transactions. A few examples include Chesapeake and Southwestern Energy planning to come together; Diamondback acquiring Firebird Energy and Endeavor Energy Resources; and now ConocoPhillips announcing its acquisition of Marathon Oil for $22.5 billion. What can we learn from these transactions on the future of shale in North America?
The oil & gas team at ADI Analytics sees five key implications from these transactions:
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