US energy giant ConocoPhillips announced this afternoon its plans to acquire competitor Marathon Oil in an all-share transaction valued at $22.5 billion (£17.7 billion), including $5.4 billion in debt.
This acquisition is the latest in a series of mergers in the US oil sector, defying calls for an energy transition amidst escalating concerns about climate change.
The deal will bolster ConocoPhillips’ presence in shale oil and gas-rich regions such as the Bakken Basin in the northern US and the Permian Basin in the south.
“This acquisition further deepens our portfolio and aligns with our financial framework, adding high-quality, low-cost supply inventory,” stated ConocoPhillips CEO Ryan Lance.
The transaction represents a 14.7% premium over Marathon Oil’s closing price on Tuesday.
ConocoPhillips expects to achieve $500 million in savings in the first year, primarily through reduced administrative and production costs, according to a statement.
In the UK, ConocoPhillips operates a significant oil terminal in Teesside and a commodities trading unit in London.
