The FTC has approved a consent order that prohibits Scott Sheffield, the founder and former CEO of Pioneer Natural Resources, from securing a position on ExxonMobil’s board or serving in an advisory capacity following the completion of the deal
FTC approves consent order for ExxonMobil's acquisition of Pioneer Natural Resources. (Credit: Ratfink1973 from Pixabay)
ExxonMobil has secured conditional approval from the US Federal Trade Commission (FTC) for its $64.5bn acquisition of Permian shale basin operator Pioneer Natural Resources.
The FTC said that it addressed antitrust concerns related to the deal by approving a consent order.
Under the order, Scott Sheffield, the founder and former CEO of Pioneer Natural Resources, is prohibited from securing a position on ExxonMobil’s board or serving in an advisory capacity following the completion of the deal.
The FTC said that the consent order aims to stop Sheffield from colluding to increase crude oil prices. Furthermore, the agency alleged that he tried to collaborate with the Organization of the Petroleum Exporting Countries (OPEC) and OPEC+ to reduce oil and gas output, potentially raising pump prices for Americans.
FTC Bureau of Competition Deputy Director Kyle Mach said: “Mr. Sheffield’s past conduct makes it crystal clear that he should be nowhere near Exxon’s boardroom. American consumers shouldn’t pay unfair prices at the pump simply to pad a corporate executive’s pocketbook.
“The FTC will remain vigilant in its enforcement efforts to protect competition in these vital markets.”
According to the FTC, Sheffield’s potential appointment to ExxonMobil’s board would also be anticompetitive. This is because he currently serves on the board of Williams, which operates midstream assets and other businesses that directly compete with ExxonMobil.
Pioneer Natural Resources responded to the FTC’s action, expressing disagreement and surprise at the complaint against Sheffield. Despite this, the company said that along with Sheffield, it will not obstruct the merger’s closure.
The all-stock deal between ExxonMobil and Pioneer Natural Resources was announced in October 2023.
The merger combines Pioneer Natural Resources’ over 850,000 net acres in the Midland Basin with ExxonMobil’s 570,000 net acres in the Delaware and Midland Basins. This results in the combined entity having an estimated resource of 16 billion barrels of oil equivalent in the Permian Basin.