U.S. Oil Industry Sets Record with $144 Billion of M&A Deals in Q4

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The U.S. upstream oil and gas industry booked its biggest-ever quarter for mergers and acquisitions in the fourth quarter of 2023, with a total of $144 billion worth of deals, Enverus Intelligence Research (EIR) said in a report on Tuesday.
The record-setting fourth quarter also pushed the full-year 2023 deal value to more than $190 billion, also an all-time high for upstream M&A deals in America, according to the energy intelligence firm.
The two mega deals by Exxon and Chevron, each worth more than $60 billion, led to a surge in M&A value in the final quarter of 2023.
ExxonMobil’s $65 billion acquisition of Pioneer Natural Resources is the third-largest upstream deal ever by enterprise value, and Chevron purchasing Hess for $60 billion is the fourth largest ever, Enverus said.
“Oil and gas is undergoing a historic consolidation wave comparable to what occurred in the late 1990s and early 2000s giving rise to the modern supermajors,” Andrew Dittmar, senior vice president at Enverus, said in a statement.
“After a decade of lowered investment in exploration and with the major U.S. shale plays largely defined, M&A has become the preferred tool to replace declining reserves and secure longevity in these companies’ profitable upstream businesses.”
The Permian led the deals in 2023, as buyers were willing to pay up for acreage in the most prolific shale play, Dittmar noted but added that this year is unlikely to see a repeat of the 2023 M&A mega deals.
“While the buyer interest is still there, we are unlikely to see an encore in 2024 because the available list of attractive takeout targets has grown short,” Dittmar said.
The deal-making in the U.S. oil and gas industry continued in 2024. In one of the latest transactions, Chesapeake Energy Corporation and Southwestern Energy agreed earlier this month to merge in an all-stock transaction valued at $7.4 billion, which will create the biggest U.S. natural gas producer by market value and production.