Chevron Corp. CEO Mike Wirth says he’s open to more deals after agreeing to buy PDC Energy Inc. for $6.3 billion, but will stay disciplined on price.
Chevron plans to increase its capital spending by $1 billion per year, after realizing about $400 million in cost savings once the transaction closes by end of year, pending regulatory and PDC shareholder approval. Its new global spending range will be $14 billion to $16 billion a year through 2027. Separately, Exxon Mobil Corp. agreed to sell assets in the Williston Basin to Chord Energy for $375 million in what’s expected to be a busy year of mergers and acquisitions U.S. shale.
Oil and gas producers have raked in record profits over the past year, leaving the U.S. energy patch ripe for a takeover boom. Companies are looking to consolidate, acquiring rivals to secure drilling sites for the future.
The PDC tie-up “doesn’t preclude our ability to do further transactions,” Wirth said in a phone interview, according to Bloomberg News. “But we don’t have gaps to fill. We’re always looking, but we’ll stay very disciplined as we have been on a number of transactions as we have done over recent years.”