The Federal Trade Commission granted clearance for Exxon Mobil’s $60 billion acquisition of Pioneer Natural Resources on Thursday. However, the former CEO of Pioneer, Scott Sheffield, was prohibited from joining the new company’s board of directors.
The FTC stated on Thursday that Sheffield, who established Pioneer in 1997, engaged in collusion with OPEC and OPEC+ to potentially increase crude oil prices. Despite retiring from the company in 2016 and then returning as president and CEO in 2019, serving as CEO until 2023, and continuing to be on the board, Sheffield was accused of attempting to coordinate oil production across the Permian Basin in West Texas and New Mexico with OPEC+. The FTC proposed a consent order stipulating that Exxon refrain from appointing any Pioneer employee, with certain exceptions, to its board.
Pioneer, headquartered in Dallas, expressed disagreement with the allegations but stated it would not obstruct the merger’s closure, announced in October 2023.
According to the FTC, Sheffield’s actions included making public statements, exchanging text messages, holding in-person meetings, engaging in WhatsApp conversations, and other communications during his tenure at Pioneer. The company stated that it saw these as a fundamental misunderstanding of U.S. and global oil markets and misinterpretation of Sheffield’s actions and intentions.
The acquisition significantly enhances Exxon’s presence in the Permian Basin, a vast oilfield spanning Texas and New Mexico. Combining Pioneer’s more than 850,000 net acres in the Midland Basin with Exxon’s 570,000 net acres in the Delaware and Midland Basin creates nearly contiguous fields, which will enable the merged company to streamline costs.
