ConocoPhillips buys Concho Resources
U.S. oil and gas giant ConocoPhillips is buying competitor Concho Resources, a company specialised in shale oil extraction in the Permian Basin of Texas and New Mexico.

The combined company will hold resources amounting to about 23 billion barrels of oil equivalent. Initial assessments suggest its daily production could total 1.5 million barrels of oil equivalent, making the company one of the largest oil and gas corporations in the world.

A statement issued by the two companies put the cost of the deal at $9.7 billion. Concho shareholders will receive 1.46 shares of ConocoPhillips for each share they hold – a 15 % premium on the closing price of 13th October. The capitalisation of the merged company will total $60 billion.

The deal must be approved by the shareholders of both companies and by regulators. Both companies expect it to be concluded in the first quarter of 2021.

The combining of ConocoPhillips and Concho is a logical step in the process of mergers and acquisitions on the U.S. shale oil market.

Last year, Occidental Petroleum acquired Andarko Petroleum for $38 billion. A merger was later announced of Devon Energy and WPX Energy. Both companies are engaged in extraction of shale oil in the United States.

Earlier this month, oil giant Chevron announced it was buying Noble Energy, which holds assets in the Permian Basin, in Colorado and in the Eagle Ford Basin in Texas.

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