(New York) The American oil groups APA Corporation and Callon Petroleum announced on Thursday their planned merger, a transaction worth around $4.5 billion which should allow APA to strengthen itself in the abundant Permian Basin in the United States.
“Callon has built a strong portfolio in the Permian Basin that is complementary to our own Permian assets and adds opportunity in the Delaware [basin],” commented John J. Christmann IV, head of APA, quoted in a press release. common.
Callon owns nearly 500 square kilometers in the Permian Basin, the largest shale oil reserve in the United States. APA’s position in the Delaware and Midland basins will increase by more than 50% thanks to this union.
Their combined daily production exceeds 500,000 barrels.
According to the press release, the operation must be carried out exclusively in shares with 1.0425 APA shares for one Callon share, thus valued at $38.31.
APA plans to issue 70 million securities to complete this $4.5 billion operation, including debt.
Around 10 a.m. ET, APA stock was down 6.27% to $34.44 and Callon was up 4.37% to $35.11.
The project was unanimously approved by the two boards of directors, but must still receive the agreement of the shareholders of the two groups.
Finalization is expected during the second quarter, after regulatory green lights. Current APA shareholders will then own approximately 81% of the new entity and those of Callon the balance.
This is the latest transaction in the American oil industry.
In the second half of 2023, the American giants ExxonMobil and Chevron strengthened their presence in fossil fuels and in particular in the controversial sector of shale oil and gas.
The first completed the purchase of Denbury, specializing in CO2 capture, at the beginning of November for $4.9 billion and announced on October 11 the purchase of Pioneer Natural Resources for $60 billion.
Its competitor Chevron also struck a major blow with the announcement on October 23 of the purchase of the American gas and oil producer Hess for $60 billion (including debt).