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The merger, estimated at around $60 billion, comes at a time when Exxon’s shares have recently decreased to $110.45. In contrast, Pioneer’s shares have risen to $237.41, valuing the company at approximately $55 billion. As part of the deal, Pioneer shareholders are anticipated to gain 2.3234 Exxon shares for each share owned.
This strategic move is expected to bolster Exxon’s position as the premier oil producer in the Permian Basin. It promises to double Exxon’s daily production in the region, reaching 1.3 million barrels. This expansion comes amidst speculation regarding the impact of the Israel-Hamas conflict on oil prices and follows Exxon’s record-breaking profit in 2022.
Moreover, the merger is not solely about increasing production. It also aims to expedite Pioneer’s net-zero plan to 2035, underlining a commitment to environmental benefits and long-term value creation.
The deal is expected to close in early 2024. However, it coincides with a sexual assault charge against Exxon Mobil’s Head of Shale Oil Business, an issue that may cast a shadow over this significant business development.
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