Jordan Soto, executive producer, Hart Energy: To get better, you need to get bigger. That's what one analyst notes about the massive $4.5 billion deal Permian Resources (PR) just announced with Earthstone Energy, but there's more to the story. Joining us is Neal Dingmann, managing director of energy research at Truist Securities, and interestingly enough, the man who introduced the CEOs in this deal. Neil—PR traditionally focused on organic growth. Now they're growing through acquisition. What's your insight on the deal?

Neal Dingmann, managing director of energy research, Truist Securities: Yeah, I think that is the big deal. If you would say what's changed over the last maybe year to three in the group? And I think scale and size has become much more important. And that is because I think if you went back two or three or four years ago, maybe even a little bit longer, it was up to a lot of the smaller E&Ps to go in there and figure out which areas were the best, figure out which ways to drill them the best. And I think now there's not much of that that's still undiscovered, if you will. So again, I think now the key areas are who can come in there most efficiently, who can have the best well productivity, who can have the best balance sheets, all those things that makes them a better company.

JS: Thanks Neal! Do you think this deal set PR up to potentially be bought by a bigger player? Let us know. That's your A&D Minute, powered by BOK Financial Securities.

Comments