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Climate activists warn that two mega-mergers among oil companies could slow the energy transition and make it even less likely the world hits targets necessary to limit climate catastrophes. First, ExxonMobil's merger with Pioneer Natural Resources established ExxonMobil as a dominant player in the Permian Basin across New Mexico and Texas. This week, Chevron announced it's purchasing Hess in a $53 billion deal, adding to its portfolio in North Dakota's Bakken shale and overseas.
E&E News reports that both companies say the mergers will allow them to increase production into the 2030s. Energy analyst Bob McNally told Axios that the mergers are a sound rejection of views that global climate policies are about to cause oil demand to peak.
"Since late 2021, industry investment and politics have shifted away from keep-it-in-the-ground and back to all-of-the-above," McNally said. "These moves and the dial-back on decarbonization momentum generally deeply alarms climate groups."
The mergers also draw a bigger distinction between America and Europe, where major oil companies had been diversifying more quickly into wind and solar power. The Financial Times notes that the mergers will increase pressure on BP, Shell, and TotalEnergies to demonstrate that their strategies are financially sound.
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Yes, things take time. It doesn’t happen overnight, doesn’t happen over a month, a year, it takes time…It takes time to educate people, people from the … Environmental Protection Agency, from the Nuclear Regulatory Commission, to hold this mill accountable. It’s not just about money, it’s about the lives, each one of the lives that crossed this road and traveled this road. And this mill here is not in the best interest of this community, and they need to move it, close it, put it someplace else where it has no effect to life, water, or the environment. That’s what we ask.”
