• 4 minutes Electric cars may make driving too expensive for middle classes, warns Vauxhall chief
  • 7 minutes Natural gas mobility for heavy duty trucks
  • 9 minutes *****5 STAR Article by Irina Slav - "The Ugly Truth About Renewable Power"
  • 53 mins U.S. Presidential Elections Status - Electoral Votes
  • 25 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 1 day Colonial pipeline hack
  • 4 days 'Get A Loan,' Commerce Chief Tells Unpaid Federal Workers
Goldman Sachs Doubles Down On $80 Oil Prediction

Goldman Sachs Doubles Down On $80 Oil Prediction

Goldman Sachs has reiterated its…

China Delivers Crushing Blow To Wind, Solar Power

China Delivers Crushing Blow To Wind, Solar Power

China will stop subsidizing new…

IEA Tells OPEC To “Open The Taps”

IEA Tells OPEC To “Open The Taps”

Oil prices climbed on Friday…

Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

Occidental Petroleum, Anadarko Seal The Deal

Occidental Petroleum and Anadarko yesterday signed a merger agreement putting the final stroke to the biggest deal in oil and gas since Shell’s acquisition of BG Group.

Hart Energy quoted a statement by Oxy’s chief executive, Vicki Hollub, as saying, “This transaction further establishes Occidental as a premier operator in prolific global oil and gas regions with the ability to deliver production growth of 5% through investment in projects with industry-leading returns.”

Indeed, the deal will cement and expand Occidental’s position as the largest oil producer in the Permian after it incorporates Anadarko’s acreage, which comes in at some 600,000 acres gross in the Delaware Basin, part of the largest shale play. It is to a large extent this acreage that prompted Chevron to bid for its smaller rival, but the supermajor yesterday dropped out of the race, leaving all 600,000 acres as well as assets outside the shale patch to Occidental.

Chevron had offered to pay some US$33 billion for Anadarko and assume US$15 billion in debt, with 75 percent of the price to be paid in stock and the rest in cash. The enterprise value of Anadarko, Chevron said at the time, was US$50 billion.

Yet Occidental, which had tried to acquire Anadarko before, returned on the scene with a higher percent of the total to be paid in cash, of which US$10 billion provided by Warren Buffett in what surprised many as an uncharacteristic move in oil and gas.

Initially, Oxy offered 50 percent of the US$57-billion price in cash and the rest in stock, but Anadarko was reluctant to accept this bid. Oxy then upped the cash portion of the deal to 80 percent and won the approval of Anadarko’s board. Chevron, meanwhile, walked away US$1 billion richer from the breakup fee Anadarko owed it for such a case and with a higher share price as traders apparently appreciated the fact that it won’t be spending almost US$50 billion on an acquisition.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News