Occidental Petroleum has announced a purchase agreement to buy Midland, Texas-based oil and gas producer CrownRock in a deal worth approximately $12 billion. The transaction is expected to close in the first quarter of 2024, subject to customary closing conditions and regulatory approvals.

Occidental now owns CrownRock’s over 94,000 net acres of land in the Midland Basin, stated the company. Additionally, the purchase will add over 170,000 barrels of oil equivalent a day in production in 2024, along with approximately 1,700 undeveloped sites.

According to the company, the acquisition provides Occidental with greater basin diversification as the majority of the inventory is located in largely clean and undeveloped sections.

“We believe the acquisition of CrownRock’s assets adds to the strongest and most differentiated portfolio that Occidental has ever had,” said Occidental president and chief executive officer Vicki Hollub. “We found CrownRock to be a strategic fit, giving us the opportunity to build scale in the Midland Basin and positioning us to drive value creation for our shareholders with immediate free cash flow accretion.”

“We are excited about combining CrownRock’s high-performing team into our organization and expect to continue Occidental’s exceptional operational and financial results for years to come,” Hollub added.

“Occidental’s purchase of CrownRock is a multi-win proposition for CrownRock, our employees and customers, and our community,” said Tim Dunn, CrownRock operating chief executive officer. “We congratulate Occidental and look forward to seeing their historically successful company continue to grow and prosper.”

The deal follows Exxon Mobil’s $64.5 billion acquisition of Pioneer Natural Resources and Chevron’s deal to acquire Hess Corporation for $53 billion.