By Matt Abel, VP of Policy.
In early October, ExxonMobil officially announced its merger with Pioneer Natural Resources, which will be the company’s largest acquisition since 1999, when it purchased Mobil. The $59.5 billion deal is a huge development that will impact Texas’ business community substantially by fostering economic growth and reinforcing our state’s dominant position in the energy sector.
Pioneer has over 850,000 acres in the Midland Basin and this merger will allow Exxon to tap into these extensive reserves, significantly boosting production capacity. Our state can expect production volume in this area to double to approximately 1.3 million barrels of oil per day once the deal closes in the first half of 2024. This increased manufacturing will further stabilize energy prices and ensure a reliable energy supply for Texans and their businesses.
The deal also bodes well for the future of both companies. Combining the technical expertise, resources and assets of the two entities will create synergies that will lead to operational efficiencies and lower costs. As a result, businesses throughout the Lone Star State that are in the energy sector or provide support services, stand to benefit from increased demand for their offerings. It will also be beneficial to the environment, with Exxon hoping to employ environmental best-practices that will allow Pioneer’s current net-zero plan to be attainable as early as 2035, instead of 2050.
Chairman and CEO of Exxon, Darren Woods, said in a statement, “Pioneer is a clear leader in the Permian with a unique asset base and people with deep industry knowledge. The combined capabilities of our two companies will provide long-term value creation well in excess of what either company is capable of doing on a standalone basis.”
This development is a key plank in continuing to expand and diversify Texas’ successful ‘all-of-the-above’ approach to energy dominance that has made our state a global leader in this sector. From increased production and job creation to technological advancements and potential environmental initiatives, this partnership will further strengthen Texas’ economy.