By Colin Kellaher

Chevron on Monday said it agreed to buy independent oil-and-gas company PDC Energy in a $6.3 billion stock swap that bolsters the energy giant's position in key U.S. production basins.

Chevron said it would issue 0.4638 shares, worth $72 based on Friday's closing price of $155.23, for each share of Denver-based PDC, a nearly 11% premium to Friday's closing price of $65.12.

Chevron, based in San Ramon, Calif., said the deal has a total enterprise value of $7.6 billion, including PDC's debt.

Chevron said the PDC deal would add 10% to its oil-equivalent proved reserves for under $7 a barrel and adds 275,000 net acres adjacent to its position in the Denver-Julesburg Basin, along with 25,000 net acres in the prolific Permian Basin, the largest U.S. oil field.

Chevron said it would issue roughly 41 million shares in the deal, slated to close by the end of the year, adding that it expects the transaction to add $1 billion to annual free cash flow.

Trading in shares of PDC was halted premarket on Monday.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

May 22, 2023 08:33 ET (12:33 GMT)

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