ExxonMobil Acquires Denbury for $4.9 Billion in Push for CO2 Pipeline Expansion

US: ExxonMobil announced on July 13, 2023, that it has acquired Denbury for $4.9 billion in an all-stock transaction. The acquisition is part of ExxonMobil's effort to accelerate its energy transition business with an established player in Carbon capture and storage (CCS). The deal will give Exxon access to Denbury's expertise in the development of oil, natural gas, and CCS assets.

ExxonMobil has announced its acquisition of Denbury, a Carbon solutions company, in an all-stock transaction valued at $4.9 billion. The deal will provide ExxonMobil with a significant boost to its energy transition business by adding an established player in Carbon capture and storage (CCS) to its portfolio. As part of the agreement, Denbury will bring expertise in enhanced oil recovery and CCUS operations in the Rocky Mountain and Gulf Coast regions. This acquisition is another milestone in ExxonMobil's efforts to reduce emissions and establish itself as a leader in low-emission technologies.

ExxonMobil’s recent acquisition of Denbury is set to make it the largest owner and operator of CO₂ pipeline network in the United States. The all-stock deal is valued at $4.9 billion and is part of ExxonMobil's strategy to expand its business into low-Carbon solutions, focusing on Carbon capture and storage technology. The acquisition will also give ExxonMobil access to Denbury's oil and natural gas operations, which have over 200 million barrels of proved reserves in the Gulf Coast and Rocky Mountain regions, with current daily production of 47,000 barrels of oil equivalent.

According to Denbury's CEO and President, Chris Kendall, partnering with ExxonMobil was crucial for their CO₂ business due to the significant capital and years of work required for its development. Through an all-equity consideration, Denbury shareholders can benefit from ExxonMobil's strong capital return strategy and participate in the potential growth of ExxonMobil's stock. ExxonMobil Low Carbon Solutions President, Dan Ammann, stated that the combination of assets and capabilities between the two companies has the potential to efficiently reduce emissions by over 100 million metric tonnes per year in one of the highest-emitting regions of the US once fully developed and optimized.

Both boards of directors have given their unanimous approval for the transaction to take place, which is expected to be completed in Q4 of 2023. However, before the deal can be finalized, it must go through customary regulatory reviews and approvals.

ExxonMobil, which is often referred to as Exxon Mobil Corporation, holds a position among the biggest publicly traded companies that deal in oil and gas across the globe. The company has a rich history, being the largest direct descendant of John D. Rockefeller's Standard Oil. ExxonMobil's vertical integration throughout the oil and gas industry is complemented by its chemicals division, which produces a range of chemical products such as plastic, synthetic rubber, and others.

The company is headquartered in Texas and is committed to reducing greenhouse gas emissions while developing lower-emissions technologies. In 2023, the company announced its acquisition of Denbury, a move aimed at promoting Carbon capture and storage technology.