Diamondback Energy and Endeavor Energy Resources hold final talks to reach a deal that could create a giant in the Petroleum and gas with a value of more than 50 billion dollarssaid people with knowledge of the matter.
Closely held Endeavor would be valued at about $25 billion in the stock-and-cash deal, which could be announced as soon as Monday, Feb. 12, said the people, who asked not to be identified because the talks are not public.
Diamondback has a market capitalization of $27.2 billion. The Wall Street Journal reported on the discussions Sunday morning.
Representatives for Diamondback and Endeavor, both based in Midland, Texas, have not responded to Bloomberg’s requests for comment.
The United States is the largest oil producer in the world, due to frenetic drilling in the Permian Basin of Texas and New Mexico. Oil is in high demand despite efforts to make the transition, and consumption is expected to increase until 2030.
The combination of Diamondback and Endeavor would be the latest in a series of major mergers that have recently reshaped the American oil corporate landscape. Last year, Exxon Mobil agreed to acquire Pioneer Resources for $60 billion, while Chevron agreed to buy Hess for about $53 billion and Occidental Petroleum reached an agreement to buy CrownRock LP for about $10.8 billion.
The wave of consolidation marks a maturation of the industry, which was previously fragmented, lacked few players of significant size and struggled to attract major investors. Also driving the agreements was the desire of some of the largest operators to replenish their inventory of lands that can be drilled and fracked.
Endeavor was seen as one of the last major potential candidates for consolidation in the Permian. Founded by Autry Stephensremains one of the last major closed producers and has attracted interest from Exxon, Chevron and ConocoPhillips.
Endeavor occupies a significant position in the Permian Basin with rights to approximately 350 thousand acres and produces around 331 thousand barrels of oil equivalent per day, according to Bloomberg intelligence.