Centennial Resource Development and Colgate Energy Partners have agreed to merge to form a $ 7 billion oil and gas company with a focus on the Permian Basin.
The deal comes at a time when crude oil prices have risen following sanctions on Russia following its invasion of Ukraine, helping to create attractive corporate valuations after years of underperformance.
Centennial’s share rose 4% in pre-conference trading.
The deal will create the largest production and exploration company focusing on the Delaware Basin, the westernmost shale deposit in the Permian, the companies said, with current production at 135,000 barrels per day.
The deal is expected to be completed in the second half of 2022, when Centennial shareholders will own 53% of the new company, and Colgate shareholders the rest.
Source: Capital
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