ConocoPhillips on Wednesday agreed to acquire its smaller rival Marathon Oil, the latest deal in an ongoing wave of consolidation sweeping the oil industry.
all stock trading Marathon's valuation is $22.5 billion, including debt. “This acquisition further strengthens our portfolio and fits within our financial framework, adding high-quality, low-cost supply inventory,” Conoco Chief Executive Ryan Lance said in a statement.
Marathon has operations in some of the most sought-after oil fields in New Mexico, North Dakota and Texas; it also drills off the coast of Equatorial Guinea.
Major oil companies have made some of the biggest acquisitions of the past year, despite regulatory scrutiny from the Biden administration and volatility in the oil market. The US giants are taking advantage of a sharp drop in oil prices. Record profitsThis gave them the power to acquire smaller players operating in oil-rich regions such as the Permian Basin, the Bakken Shale, and the Gulf of Mexico.
Last year, deals worth $250 billion took place in the oil and gas industry. According to ReutersIncluding Exxon Mobil $60 billion acquisition The $53 billion acquisition of Hess by Pioneer Natural Resources and Chevron, which was approved by Hess shareholders on Tuesday,
Conoco was in the running to buy Endeavor Energy Resources earlier this year but lost out to Diamondback Energy, which announced an agreement to buy the company in February for $26 billion,
Conoco's agreement with Marathon is subject to regulatory approval and a shareholder vote. The companies said they expect to close the deal in the fourth quarter.