Exxon Mobil is on track to finalize its $60 billion megadeal for Pioneer Natural Resources, thanks to a recent agreement with antitrust enforcers.
Former Pioneer CEO Won't Join Exxon Mobil Board
As part of the deal, former Pioneer Chief Executive Officer Scott Sheffield will not join Exxon Mobil's board of directors.
According to the Wall Street Journal, the Federal Trade Commission (FTC) is expected to soon make claims against Sheffield for engaging in collusive activity that may have increased oil prices.
It has been claimed that Sheffield frequently communicated with representatives of the Organization of the Petroleum Exporting Countries, discussing various aspects of market dynamics, such as pricing and production levels.
The oil giant has agreed with the FTC to exclude Sheffield from the board. The agreement's filing could finalize the deal between Exxon and Pioneer in days.
In October, Exxon agreed to acquire Pioneer for $60 billion in stock. This deal is Exxon's largest since its merger with Mobil in the late 1990s and is also the biggest oil-and-gas deal in the past two decades.
An oil company is poised to purchase significant oil-rich land in the Midland Basin of West Texas, an area where a smaller shale drilling company has been active for many years.
Exxon CEO: Pioneer Deal to Trim Costs, Amp US Barrel Edge
Oil executives assert that the agreements will benefit shareholders, consumers, and the environment.
According to Darren Woods, Exxon's CEO, the Pioneer deal is expected to reduce production costs and increase the competitiveness of US barrels in the global market.
This deal is seen as a strong foundation for growth, with the potential to benefit consumers in the long run. Exxon has committed to significantly reducing climate-warming emissions from Pioneer operations, aiming for net zero by 2035.
This represents an acceleration of their previous target by 15 years.
Bloomberg reported that the Biden administration has often clashed with the oil industry, but facilitating what many executives consider necessary consolidation is expected to enhance relations.
Given the recent increase in domestic crude prices and the escalating tensions in the Middle East, the current administration is facing criticism from Republicans regarding policies that negatively impact the oil industry and result in higher fuel prices.
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