The company said the transaction will allow Pioneer to use approximately 97,000 consecutive net acres (mostly undrilled land), bringing the total position of Pioneer to more than 1 million acres.
The company expects that by the end of the second quarter, the new land will produce approximately 100,000 barrels of oil per day.
Andrew Dittmar, a senior M&A analyst, said: “It’s a bit surprising to see that the pioneer company announced another major acquisition soon after its deal with Parsley, but the company may already feel that These assets are too close to their existing positions and cannot be transferred.” Data analysis company Enverus said in an email comment.
Pioneer expects that the merger will help it save approximately US$175 million in annual costs, or approximately US$1 billion in total over 10 years. This will likely enable the company to return more cash to shareholders.
Vanguard shares closed up more than 3.5% on Thursday.
The transaction is expected to be completed in the second quarter of 2021 and includes 27.2 million Vanguard shares, $1 billion in cash, and assume approximately $900 million in debt and liabilities.