A handful of oil and gas producers this month have clapped back at rumors they’re on a three-dog hunt for the next large-scale merger. Following last month’s Exxon-Pioneer and Chevron-Hess gazillion-dollar deals, the scuttlebutt has been alive and kicking over which potential pairings could be next. But one of them is catching fire.
Reese Energy Consulting today is following the latest sizzle of a merger in the works between Okla. City-based Chesapeake Energy and Houston’s Southwestern Energy, both REC clients. To review, both natural gas heavyweights operate in the Marcellus and Haynesville. Should a deal come to fruition, Chesapeake would become the nation’s largest gas producer by market value, operating a combined 1.25 million net acres and 276.8 BCFED in the Marcellus, and 871,000 net acres and 167.59 BCFED in the Haynesville.
Kimmeridge Energy Management, one of the most active and vocal U.S. investment firms (and large Chesapeake investor), has now thrown its own weight in support of a combo, stating it would create one of the few, must-own stocks in the sector and that the two gas giants will “eventually hammer out a deal.”
Meanwhile, back at The Haynesville Ranch, BP and Chevron are courting buyers. BP, which in 2019 purchased BHP’s assets there for $10.5 billion, looks to “tie up operations” on its 500,000 net acres and 13 TCF of gas reserves. Chevron, which plunked down $53.9 billion on two shale acquisitions this year, is on a quest to offload $15 billion in assets. Up for grabs is 70,000 net acres in the Haynesville where Chevron paused drilling in July.