Permian family oil companies attract outsized M&A attention

As the Permian Basin continues to be the epicenter of the US oil and gas industry, family-owned oil companies in the region are garnering significant attention from potential acquirers, Hart Energy finds. These companies, some of which have been operating in the Permian for nearly a century, hold vast swathes of valuable acreage and boast impressive inventories of drilling locations. With the industry increasingly favoring scale and efficiency, major players like Exxon Mobil, Chevron, and ConocoPhillips are actively seeking to consolidate their positions in the basin through strategic acquisitions.

Among the most coveted targets are companies like Fasken Oil & Ranch and Mewbourne Oil, which have weathered numerous commodity cycles and built substantial portfolios over generations. As the patriarchs of these family-run businesses age, more and more are considering the prospect of selling, as evidenced by recent high-profile deals such as Diamondback Energy's $26 billion acquisition of Endeavor Energy Resources and Occidental's $12 billion purchase of CrownRock. However, some family oil companies remain committed to maintaining their independence and continuing their legacy, as seen with Petro-Hunt, which is actively expanding its presence in the Delaware Basin and other regions.

While the influence of family oil companies may have diminished over time, family capital has not entirely abandoned the sector. Instead, many family offices are now investing in energy-focused private equity funds or directly into operators, helping to fill the void left by banks and public markets that have pulled back from the industry in recent years. As the Permian Basin continues to evolve, the role of family oil companies and their valuable assets will undoubtedly shape the future of the region's energy landscape, whether through strategic acquisitions or ongoing independent operations.

Image: The Yates Oil field in Pecos Texas as it looked around the 1930s. (Source: Kinder Morgan Inc, Film Collection, Archives Center, National Museum of American History, Smithsonian Institution)

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