A wave of consolidation is sweeping through the U.S. oil and gas industry, with major U.S. natural gas companies acquiring smaller rivals.

Chesapeake Energy, one of the nation's largest natural gas producers, will acquire Southwestern Energy in a $7.4 billion all-stock deal, the companies said. announced Thursday. The transaction follows ExxonMobil's acquisition of Pioneer Natural Resources and Chevron's acquisition of Hess in late 2023.

Nick Dell'Osso, President and CEO of Chesapeake, said of the transaction, “This powerful combination redefines natural gas production companies and creates the first U.S.-based company that can truly compete on an international scale. “We will form an independent company,” he said. “Energy is in short supply around the world, and demand for our products is increasing both in the United States and abroad. accelerate and foster a more affordable, reliable and low-carbon future.” (Related: Biden administration investigates major U.S. oil mergers under pressure from Senate Democrats)

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The companies expect the transaction to close in the second quarter of 2024. Once the transaction closes, the resulting company will be the largest independent natural gas company in the United States. according to to Reuters.

Chesapeake's acquisition of Southwestern will be the company's most significant effort to transition into natural gas assets since it emerged from bankruptcy in 2021, according to Reuters. The majority of Southwestern's production comes from shale deposits in the Appalachian region and Louisiana's Haynesville Basin.

“I would like to thank the entire Southwestern team for positioning us to be a part of this transformational integration,” Bill Way, President and CEO of Southwestern, said of the agreement. Ta. “Southwestern and Chesapeake will drive margin and revenue growth from highly complementary portfolios through enhanced scale, capital allocation flexibility and access to premium markets to meet growing global natural gas demand. can be promoted.”

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