The biggest oil merger in years is now official as Exxon Mobil (XOM) announced that it is acquiring Pioneer Natural Resources (PXD) for $60 billion U.S.
The deal makes Exxon Mobil the dominant oil producer in the Permian Basin region of Texas.
In a news release, Exxon Mobil said it will pay $59.5 billion U.S. for Pioneer in an all-stock deal. It’s Exxon’s biggest acquisition since its merger with Mobil back in 1999.
Rumors of a pending acquisition were first reported by the media last week.
Pioneer Natural Resource’s acreage in the Permian Basin is believed to hold some of the largest untapped oil fields in America.
For Exxon Mobil, the purchase gives it room to grow domestically and avoid geopolitical tensions in the Middle East and elsewhere.
The deal comes as crude prices again rise after war broke out in Israel. The price of Brent crude oil, the international standard, is currently at $87.47 U.S. per barrel.
Oil prices have also been lifted in recent months by the Organization of the Petroleum Exporting Countries (OPEC) and Russia reducing their output.
Exxon Mobil’s acquisition of Pioneer is the biggest deal so far in 2023 and surpasses Occidental Petroleum‘s (OXY) purchase of Anadarko for $38 billion U.S. in 2019.
Prior to today, the stock of Exxon Mobil had risen 4% this year to trade at $110.45 U.S. per share.