Chevron announces $6.3 billion deal to acquire Denver-based PDC Energy

Chevron Corp. said Monday that it will acquire Denver-based PDC Energy in an all-stock transaction valued at $6.3 billion, adding to its oil and gas holdings in the Denver-Julesburg and Permian basins.

The deal will net Chevron 275,000 acres next to its existing operations in the Denver-Julesburg Basin in eastern Colorado and more than 1 billion barrels of oil equivalent. Chevron will acquire 25,000 additional acres in the prolific oil fields of the Permian in West Texas and New Mexico.

Chevron Chairman and CEO Mike Wirth said in a statement that PDC’s assets will strengthen Chevron’s position in key U.S. production basins.

The deal is expected to boost Chevron’s annual free cash flow by $1 billion.

“The combination with Chevron is a great opportunity for PDC to maximize value for our shareholders. It provides a global portfolio of best-in-class assets,” PDC President and CEO Bart Brookman said.

Under the agreement, PDC shareholders will receive 0.4638 shares of Chevron stock, worth $72 based on Friday’s closing price of $155.23, for each PDC share. Chevron said the transaction’s total enterprise value, including debt, is $7.6 billion.

The boards of both companies have unanimously approved the transaction, which is expected to close by year’s end. The acquisition is subject to approval by PDC shareholders.

In 2020, Chevron bought Noble Energy, which was the second-largest oil and gas producer in the Denver-Julesburg Basin.

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