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Permian Basin Giants: 2024 Net Production Forecasts

Rystad Energy predicts that the merged company of Diamondback Energy and Endeavor Energy will produce 819,500 barrels of oil per day in the Permian Basin in 2024.

Rystad, an energy research and business intelligence company from Norway, expects the ExxonMobil-Pioneer Natural Resources merger to lead the Permian in total net production for the year, with a projection of nearly 1.4 million barrels per day. Notably, about 53% of this production will be oil.

Chevron is set to produce slightly more than Diamondback-Endeavor, with Occidental-CrownRock following closely. ConocoPhillips ranks fifth, with a production forecast of just under 800,000 barrels per day. Chevron's production is 47% oil, while Diamondback-Endeavor and ConocoPhillips have 57% oil in their mix, and Occidental-CrownRock is just below 50%.

The U.S. Energy Information Administration (EIA) reports that Permian Basin oil production is expected to reach 6.071 million barrels per day in February and 6.085 million barrels in March. Gas production is forecasted at 24.628 billion cubic feet in February and 24.762 billion cubic feet in March.

ExxonMobil announced in October 2023 that it plans to acquire Pioneer Natural Resources in an all-stock deal valued at $59.5 billion, or $253 per share. Pioneer shareholders will get 2.3234 ExxonMobil shares for each of their shares. The total value of the deal, including debt, is about $64.5 billion.
In December 2023, Occidental revealed plans to buy Midland-based CrownRock L.P. for around $12 billion in cash and stock, taking on CrownRock's debt in the process.

This month, Diamondback and Endeavor made public their merger agreement. The deal, worth about $26 billion, includes Endeavor's debt and merges the two into a major player in the Permian with an estimated enterprise value of $60 billion and daily production of 816,000 barrels of oil equivalent.

ExxonMobil's acquisition of Pioneer Natural Resources for $64.5 billion in October was highlighted by Rystad Energy as the start of a new phase in shale sector deals, termed 'Shale 4.0'. The following months have seen a surge in large deals in the Permian, speeding up the consolidation of this key oil-producing region.

“It became apparent that public producers were willing to pay top dollar for private E&P acquisitions that could both move the needle in terms of total inventory scale and position them for the long run in the Permian’s commercial heart”, Rystad representative noted (Occidental’s recent purchase of CrownRock).

The merger between Diamondback Energy and Endeavor Energy Resources, valued at $26 billion, is a significant part of this trend. This merger is set to create the largest independent Permian producer by output and the second-largest in terms of undeveloped drilling locations, trailing only behind the ExxonMobil-Pioneer combo, according to Rystad Energy.

About Rystad Energy

Rystad Energy is an independent advisory, research, and business intelligence company focused on the energy sector. With its headquarters in Oslo, Norway, it stands as the largest independent energy consultancy in the country and a leading analysis company for the global energy industry. Rystad Energy offers in-depth analysis and insights into the oil and gas sector, with a growing focus on renewable energy and carbon emissions analyses. Their services are vital for a range of clients including oil, oil services, finance companies, and institutions like OPEC, the International Energy Agency, and the World Bank.

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Welcome 2024: A Look Back at 2023 Top Oil and Gas Sector Deals

2023 was quite a year for the oil and gas sector, with some big deals making the news. In the US, giants like ExxonMobil and Chevron grabbed headlines with their plans to acquire companies like Pioneer and Hess. Internationally, ADNOC wasn't left behind, expanding its reach as well. As we ring in the new year, let's recap the biggest oil and gas deals of 2023.

Diamondback's buyout of Endeavor happened about four months after ExxonMobil and Chevron made huge deals, with Exxon buying Pioneer Natural Resources for $59 billion and Chevron getting Hess for $53 billion. Even though 2023 was a slow year for company buyouts and mergers, with the total deals at $3.2 trillion (the lowest since 2013 and 47% less than the $6 trillion peak in 2021), the energy sector was still active. Experts think this buzz in energy deals is because these companies made a lot of money in 2022.

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