It's a rare oil love triangle... Lust, greed, love, and drama included. The oil industry is watching the drawn-out romantic fight between Chevron and Occidental over Anadarko to acquire its "strategic real estate" (more on that to come). Here's the quick play-by-play of the bids and counter-bids to acquire Anadarko Petroleum ("APC") so far:
- April 12: Chevron offered $65/share ($33B total) to buy Anadarko. APC shares jumped from $46 to $64.
- April 24: A new suitor, Occidental Petroleum, offered $76/share ($38B) to win APC's on-shore drilling assets, so APC stock popped from $64 to $72 on the sweeter deal.
- Yesterday: To seal the thing, Occidental upped its offer to include more cash and fewer Occidental shares (same price though overall). APC shares rose to $75 on expectations this one's happening.
It looks like Chevron will lose... But its thirst for more oil still isn't satiated. Investors speculate that one of the other, smaller Texas oil companies could get snatched as the consolation prize, so shares of Pioneer, Concho, and Diamondback have all risen.
The prize is a bunch of West Texas land... that's fortunately got an ocean of oil beneath it. Natural resource extraction is a fascinating industry — Who has the sharpest ax, deepest drills, or pumpiest pumps? Anadarko has drilling rights to land in the 75K square mile "Permian Basin" where it's easiest/cheapest to produce oil. And Anadarko's oil straws can suck out millions of barrels of oil worth billions of dollars.