A major American natural gas company is acquiring a smaller rival, extending a wave of consolidation sweeping over the American oil and gas industry.
Chesapeake Energy, one of the country’s largest natural gas producers, is buying Southwestern Energy in a $7.4 billion all-stock deal, the companies announced Thursday. The deal follows ExxonMobil’s acquisition of Pioneer Natural Resources and Chevron’s purchase of Hess in late 2023.
“This powerful combination redefines the natural gas producer, forming the first U.S. based independent that can truly compete on an international scale,” Nick Dell’Osso, Chesapeake’s president and CEO, said of the deal. “The world is short energy and demand for our products is growing, both in the U.S. and overseas. We will be positioned to deliver more natural gas at a lower cost, accelerating America’s energy reach and fueling a more affordable, reliable, and lower carbon future.” (RELATED: Biden Admin Probing Major US Oil Merger After Pressure From Senate Dems)
Natural gas is keeping Dems up at night https://t.co/RAWj0YkBAG
— Daily Caller (@DailyCaller) May 8, 2023
The companies are anticipating that the deal will close in the second quarter of 2024. Assuming the transaction is finalized, the resultant firm will become the largest independent natural gas company in the U.S., according to Reuters.
Chesapeake’s acquisition of Southwestern is the company’s most significant effort to shift toward natural gas assets since it came out of bankruptcy in 2021, according to Reuters. The majority of Southwestern’s output derives from shale deposits in the Appalachian region and Louisiana’s Haynesville basin.
“I want to thank the entire Southwestern team for positioning the company to be part of this transformational combination,” Southwestern president and CEO Bill Way said of the deal. “Together, Southwestern and Chesapeake can drive improved margins and returns from our highly complementary portfolios through enhanced scale, capital allocation flexibility and access to premium markets to supply growing global natural gas demand.”
All content created by the Daily Caller News Foundation, an independent and nonpartisan newswire service, is available without charge to any legitimate news publisher that can provide a large audience. All republished articles must include our logo, our reporter’s byline and their DCNF affiliation. For any questions about our guidelines or partnering with us, please contact licensing@dailycallernewsfoundation.org.