Copyright © BusinessAMBE 2023

US oil giant ExxonMobil has secured the astronomical sum of nearly $60 billion to acquire its Texas sector peer Pioneer Natural Resources. That company specializes in shale gas and oil extraction.

Will Big Oil invest in renewable energy, or in classic fossil sources? ExxonMobil has now indirectly answered that pressing question in the energy sector. Fossil fuels will remain the priority for decades to come.

In the news: ExxonMobil is acquiring Pioneer Natural Resources for $59.5 billion through a share swap.

  • This is the largest deal for the energy giant since the merger of Exxon and Mobil Oil in 1998.
  • The timing for the deal was prompted by ExxonMobil's recent share price rally, which nearly doubled in two years. That opened the door for the giant share swap.

Permian Basin

The gist: The acquisition makes ExxonMobil the dominant player in the Permian Basin(Permian), the huge fields in Texas and New Mexico that are at the heart of U.S. shale gas and oil extraction.

An excerpt from ExxonMobil's presentation:

Zoomed out: The deal makes it clear that the U.S. energy giants will continue to rely on fossil fuel production.

  • Indeed, the nearly $60 billion will not be invested in a large-scale shift to renewable energy, which environmentalists are calling for.
  • ExxonMobil appears to have prepared for criticism from that quarter, promising to accelerate Pioneer's zero-emissions plan by 15 years. This would achieve the goal of net zero greenhouse gases not in 2050, but as early as 2035.

© The Content Exchange, source News