Occidental Petroleum Corp. is among those vying for Yates Petroleum Corp., one of the largest closely held oil companies in the U.S., in a deal that could fetch as much as $3 billion, according to people familiar with the talks.
Yates, which has oil fields in New Mexico's Permian Basin and elsewhere in the U.S., is trying to sell itself before the year ends in an effort to avoid higher taxes on transactions that are anticipated next year, these people said.
Bids are due this week for the Artesia, N.M., company, which has hired J.P Morgan Chase & Co. to find a buyer, the people said. A deal is far from certain, especially if the company doesn't attract bids at the $2 billion to $3 billion price it is seeking, one person said.
Yates is best known for its operations in its home state, where last year it ranked eighth in oil production and 11th in natural-gas output, according to New Mexico Energy, Minerals and Natural Resources Department data.
The company also has drilling fields and satellite offices in Colorado and Wyoming, where it produces coal-bed methane in the Powder River Basin, as well as a pair of pipeline companies. Last month the company leased tracts above the Bakken Shale formation in North Dakota and Montana from the federal government, according to U.S. Bureau of Land Management records.
Yates is controlled by descendants of Martin Yates Jr., an early wildcatter who helped discover New Mexico's oil reserves. Other Yates family members have separate oil and gas operations in the state.
Two years ago Occidental acquired one of them, oil-field-service firm Yates Drilling Co., for an undisclosed sum, according to New Mexico corporate filings.
Based in Los Angeles, Occidental is one of the largest U.S. oil and gas producers, with a stock market value of more than $64 billion. It has domestic oil fields in California, Texas, North Dakota and New Mexico as well as international operations in the Middle East and Colombia and a large chemical-manufacturing business.
Occidental has historically been one of the top energy producers in New Mexico, which is home to a portion of the oil-rich Permian Basin, and a consolidator there.
The Permian, which stretches into west Texas and is one of the longest continuous oil-producing areas in the U.S., has seen a renaissance in recent years as new drilling technology has allowed energy producers to reach previously untapped hydrocarbons.
Fields there have been among the deal market's hot properties as big oil companies look to add to their holdings in the basin.
Could they buy them, yes, but seems unlikely based on the limited information available. Is Yates production heavily PDP? This seems like the kind of deal where a large major can pick up acreage and production and pay a premium to gain a foothold or strengthen their holdings in the area.
As fae as I can determne, it's all PDP exept for the tiny Bakken acreage, which they are only part owner. Linn has operations in the Powder River Basin and could use the Yates Pipelines there. It would expand Linn's New Mexico operations.
You are not functioning as a self aware or cognitive individual.
The limit of your existence is posting the nonsense of others which in your delusion mistakenly assume helps the collective.
You never have understood a single investment or economic concept. This occurs as your emotions drive you to accept political propaganda as an objective source of knowledge. You will do or day anything to maintain your personal delusion.
IN this process you fill this board with delusions and absolutely demand we share them. The nature of the useful idiot of the collectivist elite.
Investors on this board need to understand Obama's tax agenda, the coming fracturing regulations and what elements of the Progressive GW religion will be enacted to punished domestic energy production.
A radical EPA starving human beings for what they know to be worthless ethanol special interest corruption and which outlawed our domestic coal industry is not worried about imposing economy destroying fracturing regulations.
The Obama reality is here and the odds of a recession are better than 50/50 not including the 'cliff;,.
This small point is in the text you just posted:
"Last month the company leased tracts above the Bakken Shale formation in North Dakota and Montana from the federal government, according to U.S. Bureau of Land Management records."
why would they buy in the Bakken, since you keep advising against that....like you know better?.
over at KOG and also here....
.....you have been incorrectly claiming that Continental Resources is wrong...
XOM is also wrong with their recent bakken purchase
Statoil is wrong too?
all of those bakken producers are all just wrong as you keep posting because you think that the decline rate is just too high.
Some of those who do read alot about the Bakken, wonder if it is you instead.
Sentiment: Strong Buy