• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 2 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 4 days How Far Have We Really Gotten With Alternative Energy
  • 9 days By Kellen McGovern Jones - "BlackRock Behind New TX-LA Offshore Wind Farm"
  • 4 days Solid State Lithium Battery Bank
  • 3 days Bad news for e-cars keeps coming
  • 15 days The United States produced more crude oil than any nation, at any time.
Can the U.S. Avoid an Energy Crisis?

Can the U.S. Avoid an Energy Crisis?

Current U.S. energy policies favoring…

Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

Chevron To Buy Shale Firm PDC Energy In $6.3-Billion Deal

  • Chevron Corporation has signed a deal to buy PDC Energy in an all-stock transaction valued at $6.3 billion.
  • The market has been expecting deal-making to accelerate this year, and some analysts believe this might be the first move of many.
  • PDC Energy shares surged 7.89% in pre-market trade on Monday after the agreement was announced.
Shale

Chevron Corporation has signed a deal to buy shale firm PDC Energy in an all-stock transaction valued at $6.3 billion, or $72 per share, the U.S. supermajor said on Monday in what could be an acceleration of deal-making in the shale patch.

The total enterprise value of the deal, including debt, is $7.6 billion.

The transaction price represents a premium of 14% on a 10-day average based on closing stock prices on May 19, 2023, Chevron said.

PDC Energy shares surged by 7.89%, or by $5.14, to over $70 apiece, in pre-market trade on Monday after the agreement was announced.

The transaction has been unanimously approved by the boards of directors of both companies and is expected to close by the end of this year. The acquisition is subject to PDC shareholder approval, to regulatory approvals, and other customary closing conditions. 

Through the acquisition of PDC Energy, Chevron will gain high-quality assets adjacent to its positions in the Denver-Julesburg (DJ) and the Permian Basins.

“PDC’s attractive and complementary assets strengthen Chevron’s position in key U.S. production basins,” Chevron chairman and CEO Mike Wirth said in a statement. “This transaction is accretive to all important financial measures and enhances Chevron’s objective to safely deliver higher returns and lower carbon.”

For the shale producer, the combination with Chevron “is a great opportunity for PDC to maximize value for our shareholders,” PDC president and CEO Bart Brookman said.

After the acquisition, Chevron expects to increase capex by around $1 billion per year, raising its guidance range to $14 to $16 billion through 2027, after realizing about $400 million in capex efficiencies post-closing.

The market has been expecting a deal from the supermajors since reports emerged last month of talks about ExxonMobil potentially buying Pioneer Natural Resources.

“All of this seems to point toward an industry that looks increasingly like it did before shale in the context of the biggest companies and majors holding the best, lowest-cost resource,” Andrew Dittmar, a Director on the Enverus Intelligence team, wrote last month.

By Charles Kennedy for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News