ExxonMobil, Denbury Acquisition Expands Low-Carbon Operations

Exxon Mobil Corp. has revealed its plans to acquire Denbury, a developer of carbon capture, utilization, and storage (CCUS) solutions, in addition to enhanced oil recovery techniques. The definitive agreement outlines an all-stock transaction, estimated at approximately $4.9 billion or $89.45 per share. As per the agreement, Denbury shareholders are slated to receive 0.84 ExxonMobil shares for each share they hold in Denbury.

"Acquiring Denbury reflects our determination to profitably grow our low-carbon solutions business by serving a range of hard-to-decarbonize industries with a comprehensive carbon capture and sequestration offering," said Darren Woods, Chairman and CEO. "The breadth of Denbury’s network, when added to ExxonMobil’s decades of experience and capabilities in CCS, gives us the opportunity to play an even greater role in a thoughtful energy transition, as we continue to deliver on our commitment to provide the world with the vital energy and products it needs.”

The merger is projected to induce significant growth and returns for ExxonMobil. By acquiring Denbury, ExxonMobil will own and operate a CO₂ pipeline network spanning over 1,300 miles in the United States. This includes nearly 925 miles of CO₂ pipelines in Louisiana, Texas, and Mississippi, and a total of 10 onshore sequestration sites.

“This transaction is a compelling opportunity for Denbury to join an admired global energy leader with a low-carbon focus, a robust balance sheet, and a leading shareholder return program," said Chris Kendall, Denbury’s President and CEO. "To build even further on this positive momentum, the Denbury Board of Directors and management team undertook a thorough review process and considered a number of alternatives to maximize long-term value. Through this process, it became clear that the transaction with ExxonMobil is in the best interests of our company, our shareholders, and all Denbury stakeholders."

“Denbury’s advantaged CO₂ infrastructure provides significant opportunities to expand and accelerate ExxonMobil’s low-carbon leadership across our Gulf Coast value chains,” said Dan Ammann, President, ExxonMobil Low Carbon Solutions. "Once fully developed and optimized, this combination of assets and capabilities has the potential to profitably reduce emissions by more than 100 million metric tons per year in one of the highest-emitting regions of the United States."

The acquisition agreement also entails Gulf Coast and Rocky Mountain oil and natural gas operations apart from Denbury's CCUS assets. These operations possess reserves exceeding 200 million barrels of oil equivalent, generating 47,000 oil-equivalent barrels per day of current production.

The transaction, having received the unanimous approval of both ExxonMobil's and Denbury's boards of directors, awaits standard regulatory approvals and the consent of Denbury's shareholders. The deal is expected to close in the fourth quarter of 2023.