We defy you to name an oil and gas producer that’s been on the buying side of more $1-billion-plus M&A than Permian pure play Diamondback Energy, which announced February 18 that it had agreed to purchase a chunk of Midland Basin assets from Double Eagle IV, one of the Permian’s largest privately held producers, for just under $4.1 billion. You’d be equally hard-pressed to find a team that’s assembled and flipped more Permian acreage and production than the folks at Double Eagle. In today’s RBN blog, we discuss the newly announced Diamondback/Double Eagle IV deal and what it gives Diamondback, the fourth-largest producer in the Permian after ExxonMobil, Chevron and Occidental Petroleum.
Travis Stice, who has served as the company’s CEO for the past 13 years and chairman for the past three, has said that “M&A is as fundamental to Diamondback Energy as the air we breathe.” No argument there, as evidenced by the E&P’s seemingly insatiable appetite for top-tier Permian acreage and oil-focused production. Midland-based Diamondback started a long string of multibillion-dollar deals in 2017 when it bought assets from Brigham Resources for $2.55 billion. The E&P followed that up in 2018 with agreements to acquire Ajax Resources for $1.25 billion and Energen for a whopping $9.2 billion, thereby increasing Diamondback’s Permian production by 75% and more than doubling its proved reserves. In the months after COVID hit in early 2020, the company bought QEP Resources and Guidon Energy for a total of $3 billion, and in 2022 it shelled out $1.6 billion for FireBird Energy and $1.5 billion for Lario Petroleum.
You’d think that after seven deals totaling more than $19 billion that Diamondback might have finally had its fill. After all, over just a few years it had rocketed to #5 on the list of publicly held Permian producers — and one of the biggest E&Ps in the U.S. for that matter. But the company was really only getting started. As we discussed in You Belong With Me, Diamondback announced last February that it had entered into its biggest deal ever: a $26 billion, stock-and-cash agreement to acquire privately held Endeavor Energy Resources. The transformational transaction, which closed in September, doubled Diamondback’s net acreage in the Midland to 694,000, increased its total Permian acreage by 70% to 838,000 (see Figure 1 below), and helped Diamondback boost its production by more than 90% year over year — from 463 Mboe/d in Q4 2023 to an estimated 870 Mboe/d in Q4 2024.
Figure 1. Diamondback and Endeavor Acreage in the Permian at Announcement. Source: RBN
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About the song
“Shine On You Crazy Diamond” was written by David Gilmour, Roger Waters and Richard Wright and appears in two parts — as the first song on side one and the third song on side two of Pink Floyd’s ninth studio album, Wish You Were Here. The song is a nine-part compositional tribute to Pink Floyd founding member Syd Barrett, who had left the band seven years earlier to due mental issues brought on by severe overuse of the drug LSD. The song was originally slated to occupy one side of the LP but was instead split into two parts to bookend the album. As the band was recording vocals for the song a large, bald-headed man came into the studio, sat down and began doing odd things like brushing his teeth. After a while, the band realized the man was Syd Barrett, whom no one had seen for a couple of years. Pink Floyd keyboardist Richard Wright said: “For him to show up the day we start putting vocals on a song about him ... very strange.” When someone asked Barrett what he thought about the song about him, he replied, “It sounded a bit old.” The band never saw him again after that day. Personnel on the record were: Roger Waters (lead vocal, bass, guitar, glass harp), David Gilmour (lead guitars, pedal steel guitar, bass, synthesizer, glass harp, backing vocals), Richard Wright (keyboards, glass harp, backing vocals), Nick Mason (drums, percussion), Dick Parry (tenor, baritone saxophones), and Carlena Williams, Vanetta Fields (backing vocals).
Wish You Were Here was recorded between January and July 1975 at EMI Studios (Abbey Road) in London and produced by Pink Floyd. Released in September 1975, it went to #1 on the Billboard 200 Albums chart and has been certified 6x Platinum by the Recording Industry Association of America. David Gilmour and Richard Wright have cited the album as their favorite work of Pink Floyd. One single, “Have a Cigar,” was released from the LP.
Pink Floyd is an English rock band formed in London in 1965 by Syd Barrett (lead vocals, guitar), Roger Waters (bass, vocals), Richard Wright (keyboards, vocals) and Nick Mason (drums, percussion). They were one of the first British psychedelic bands and evolved into one of the leading progenitors of the progressive rock genre. Guitarist David Gilmour joined the group in 1967 and founding member Syd Barrett left the group in 1968. Barrett’s compositions defined the band's sound in its early days. Their first two hit singles — “Arnold Lane” and “See Emily Play" — were penned by Barrett. Pink Floyd has released 15 studio albums, six live albums, 12 compilation albums, three EPs and 27 singles and have sold more than 250 million records worldwide. They have won four Grammy Awards, two Ivor Novello Awards and a Polar Music Award. The band was inducted into the Rock and Roll Hall of Fame in 1996. Both Roger Waters and David Gilmour have stated that they have no interest in reuniting Pink Floyd. They, along with founding member Nick Mason, have gone on to successful solo careers. Founding member Syd Barrett died in London in July 2006 at the age of 60. Founding member Richard Wright died in London in September 2008 at the age of 65. As a side note, Syd Barrett’s two 1970 solo albums (“The Madcap Laughs” and “Barrett”) are worth seeking out and giving a listen.
