Endeavor Energy Partners, the largest private oil and gas producer in the Permian Basin, is reportedly considering a sale. Sources suggest the company could be valued between $25 billion and $30 billion. This potential sale emerged 45 years after Texas oilman Autry Stephens founded the company.
At 85 years old, Stephens is looking to seize the opportunity amid a surge of major deals in the oil and gas sector. He has engaged JPMorgan Chase bankers to potentially initiate a sale process for Endeavor in early 2024. Stephens, who has fielded offers for Endeavor before, including in 2018, now seeks to determine the company’s future proactively, rather than leaving the decision to his estate posthumously.
Endeavor boasts extensive operations, covering 1,416 square kilometers in the Midland area of the Permian shale basin, which extends across West Texas and eastern New Mexico.
The list of potential buyers with deep pockets for a company of Endeavor’s magnitude is short. Nonetheless, the current trend of consolidation in the industry, driven by producers’ desires to expand and secure prime acreage, indicates there is interest from a select few. Recent significant transactions in the sector include Exxon Mobil’s $60 billion acquisition of Pioneer Natural Resources and Chevron’s $53 billion deal to purchase Hess.
In these deals, the acquiring companies utilized their stock as the medium of exchange, preserving their cash reserves. This strategy leaves them financially equipped to pursue Endeavor, even as they work on completing and integrating their recent acquisitions.
Exxon is already acquainted with Endeavor’s operations, having collaborated with them for drilling on Endeavor’s land until 2022. Meanwhile, ConocoPhillips recently finalized a $2.7 billion transaction to acquire a 50% stake in Canada’s Surmont oil sands project in October.
