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US Shale Producers To Unite In $6 Billion Deal

 |  March 7, 2022

Oasis Petroleum and Whiting Petroleum will merge in a $6 billion deal including debt, reported Reuters.

The combined entity will have a premier Williston Basin position in North Dakota and Montana, with top-tier assets spread across about 972,000 net acres and a combined production of 167.8 thousand barrels of oil equivalent per day, the companies said.

Upon completion of the deal, which is expected in the second half of 2022, Whiting shareholders will own about 53% and Oasis shareholders will own about 47% of the combined company on a fully diluted basis.

The deal between the companies, comes amid record high crude prices driven partly by global efforts to recover the economic losses from the COVID-19 crisis that pushed many countries to partially shut down most day-to-day economic activities. The energy ‘crunch’ has also been exacerbated in recent weeks by Russia’s invasion of the Ukraine and subsequent economic sanctions imposed on one of the world’s top oil and gas producers.

Whiting Chief Executive Offer Lynn Peterson will serve as Executive Chair of the Board of the combined company while Oasis CEO Danny Brown will become themerged entity’s top boss.

Brent crude soared to near $130 a barrel on Monday, its highest since 2008, as the United States and European allies mull a Russian oil import ban and delays in the potential return of Iranian crude to global markets fuel tight supply fears.

Both Whiting Petroleum and Oasis filed for bankruptcy in 2020 amid the global slow-down in oil demand. Whiting emerged after nearly 7 months of restructuring, while Oasis took only two months to re-capitalize its operations by November 2020.