Shale and hearty

8 Sep 2016 By Kevin Allison

EOG Resources’ $2.5 bln purchase of Yates Petroleum is the latest sign that a dealmaking revival is brewing. Investors are rewarding buyers of prime acreages from smaller, often privately held producers. More U.S. deals are likely to follow if crude prices continue to perk up.

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Shale oil producer EOG Resources said on Sept. 6 it would buy privately held Yates Petroleum for $2.5 billion in cash and stock. EOG's shares rose 6 percent. Consultants at Wood Mackenzie estimate that about $12 billion of deals have been struck in the Permian Basin this year.

Shares of Apache, another oil driller, rose nearly 7 pct on Sept. 7 and posted similar gains on Sept. 8 after it reported a big oil and gas find under some 300,000 acres of land in the same oil region.

The Permian shale, which covers portions of western Texas and southeastern New Mexico, is the largest U.S. oil field, boasting 189 of the country's 481 active drilling rigs as of early August, according to data from oil services firm Baker Hughes.

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