Carrizo, SM Energy in Talks to Team Up
(Bloomberg) -- Carrizo Oil & Gas Inc. is weighing a tie-up with U.S. energy explorer SM Energy Co., according to people familiar with the matter.
Carrizo has held early-stage discussions with SM about a potential combination, the people said, asking not to not be identified because the information is private. There’s no certainty the deliberations will lead to a transaction, the people said.
Shares of SM, based in Denver, climbed about 4.8 percent to $16.45 in early trading in New York, giving it a market value of more than $1.8 billion. Carrizo was up 1.1 percent to $11.75 for a market valuation of $1.1 billion.
The talks come as volatile oil prices put pressure on small and midsize energy explorers to pair up to cut costs, particularly in areas such as the Permian Basin of Texas and New Mexico, which is dense with competition.
A spokeswoman for SM declined to comment, while a representative for Carrizo didn’t immediately respond to a request for comment.
SM traces its roots back to 1908. The company has operations in a swathe of the Permian known as the Midland Basin, where it has been spending more to ramp up production, according to a February investor presentation. Carrizo operates in a different, fast-growing patch of the Permian known as the Delaware Basin, where it has drilling rights on about 46,000 net acres, according to an investor presentation this month.
The two companies also have drilling acreage in the Eagle Ford Shale of south Texas.
--With assistance from Kevin Crowley and Nabila Ahmed.To contact the reporter on this story: Kiel Porter in Chicago at kporter17@bloomberg.net To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net Matthew Monks, Ben Scent
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- How Likely Is an All-Out War in the Middle East Involving the USA?
- Rooftop Solar Now 4th Largest Source of Electricity in Australia
- US Confirms Reimposition of Oil Sanctions against Venezuela
- EU, Industry Players Ink Charter to Meet Solar Energy Targets
- Analyst Says USA Influence on Middle East Seems to be Fading
- Russian Ships to Remain Banned from US Ports
- Brazil Court Reinstates Petrobras Chair to Divided Board
- EIB Lends $425.7 Million for Thuringia's Grid Upgrades
- Var Energi Confirms Oil Discovery in Ringhorne
- Seatrium, Shell Strengthen Floating Production Systems Collaboration
- An Already Bad Situation in the Red Sea Just Got Worse
- What's Next for Oil? Analysts Weigh In After Iran's Attack
- USA Regional Banks Dramatically Step Up Loans to Oil and Gas
- EIA Raises WTI Oil Price Forecasts
- How Likely Is an All-Out War in the Middle East Involving the USA?
- Venezuela Authorities Arrest Two Senior Energy Officials
- Namibia Expects FID on Potential Major Oil Discovery by Yearend
- Oil Markets Were Already Positioned for Iran Attack
- Is The Iran Nuclear Deal Revival Project Dead?
- Petrobras Chairman Suspended
- Oil and Gas Executives Predict WTI Oil Price
- An Already Bad Situation in the Red Sea Just Got Worse
- New China Climate Chief Says Fossil Fuels Must Keep a Role
- Oil and Gas Execs Reveal Where They See Henry Hub Price Heading
- Equinor Makes Discovery in North Sea
- Macquarie Strategists Warn of Large Oil Price Correction
- DOI Announces Proposal for Second GOM Offshore Wind Auction
- Standard Chartered Reiterates $94 Brent Call
- Chevron, Hess Confident Embattled Merger Will Close Mid-2024
- Analysts Flag 'Remarkable Feature' of 2024 Oil Price Rally