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Exxon Buys Pioneer to Expand Oil Production in U.S. Texas

FILE PHOTO: A view of the Exxon Mobil refinery in Baytown, Texas September 15, 2008. REUTERS/Jessica Rinaldi

Exxon Mobil announced Wednesday it was buying Pioneer Natural Resources, a shale drilling firm, for 59.5 billion U.S. dollars, in a bid to expand its oil production in West Texas.

Exxon will pay 253 dollars per share in an all-stock deal, according to a statement on Wednesday, an 18 percent premium for Pioneer investors based on the closing price on Oct. 5.

It is Exxon’s largest deal since its merger with Mobil more than two decades ago, and would make Exxon the largest operator in the Permian Basin of Texas and New Mexico, the Houston Chronicle reported.

“The sum is greater than each of the parts,” Exxon CEO Darren Woods said in an interview on Wednesday. “We have more technologies in the pipeline that we think are going to further improve recovery and reduce costs.”

Woods said that Pioneer, based in Irving of northwestern Texas, currently controls some of the “most attractive acreage” in West Texas’s Permian Basin.

The deal is expected to be finalized next year.