SAN RAMON, Calif. — Chevron Corporation has entered into a definitive agreement with PDC Energy Inc. to acquire all the outstanding shares of PDC in an all-stock transaction valued at $6.3 billion, or $72 per share. The total enterprise value, including debt, of the transaction is $7.6 billion.

The acquisition of PDC provides Chevron with high-quality assets expected to deliver higher returns in lower carbon intensity basins in the U.S. PDC brings strong free cash flow, low breakeven production and development opportunities adjacent to Chevron’s position in the Denver-Julesburg Basin, as well as additional acreage to Chevron’s leading position in the Permian Basin.

“PDC’s attractive and complementary assets strengthen Chevron’s position in key U.S. production basins,” said Chevron Chairman and CEO Mike Wirth. “This transaction is accretive to all important financial measures and enhances Chevron’s objective to safely deliver higher returns and lower carbon. We look forward to welcoming PDC’s team and shareholders to Chevron and continuing both companies’ focus on safe and reliable operations.”

Chevron anticipates the transaction to be accretive to all key financial measures within the first year after closing and to add about $1 billion in annual free cash flow at $70/ bl Brent and $3.50 per mcf Henry Hub.

The transaction has been unanimously approved by the boards of directors of both companies and is expected to close by year-end 2023.