The FTC is close to approving Exxon's $60 billion acquisition of Pioneer Natural Resources, potentially making Exxon the top producer in the Permial Basin.
The U.S. Federal Trade Commission (FTC) is reportedly on the verge of approving a major acquisition in the oil industry, as Exxon Mobil Corp. is poised to finalize its $60 billion purchase of Pioneer Natural Resources Co. People with knowledge of the matter have indicated that an official announcement is expected within days.
The acquisition, which is part of a larger $230 billion wave of consolidation in the oil sector, is set to make Exxon the largest oil and natural gas producer in the Permian Basin, the biggest oil field in North America. This deal would significantly boost Exxon's production in the region, projecting an increase to about 2 million barrels a day by 2027 from approximately 600,000 last year.
The news of the impending approval by the FTC had an immediate positive impact on the stock market, with shares of Pioneer Natural Resources rebounding from a more than 2% loss to a gain of up to 0.9%. Additionally, Hess Corp, another company involved in a separate acquisition deal, saw its shares rise by 0.9%.
This development comes after more than 50 lawmakers urged the FTC in March to increase scrutiny over the wave of consolidation, expressing concerns that it could lead to higher energy prices for consumers, suppress wages, and put pressure on suppliers.
The approval could signal a shift in regulatory attitudes and set a precedent for pending takeovers by other companies in the sector, such as Chevron Corp., Occidental Petroleum Corp., and Chesapeake Energy Corp., which are currently under review by the FTC.
