Chevron Deal Could Kick Off Another Round Of U.S. Shale Consolidation

In early May, I wrote a piece here detailing the fact that the first quarter of 2023 was the slowest quarter for mergers and acquisitions (M&A) activity in the oil and gas upstream sector in a decade. That was according to the findings of a report published by energy intelligence and analytics firm Enverus, which was able to detail just 16 significant upstream transactions with a total value of $8.6 billion for the quarter.

By the end of last week, the slow pace of deal-making had extended well into May. But Monday, California-based Chevron
CVX
shifted the narrative somewhat with the announcement of an all-stock buyout of Denver upstream company PDC Energy in an acquisition valued at $7.6 billion including assumed debt. It is a transaction which ranks as far and away the largest U.S. oil and gas upstream acquisition thus far in 2023.