Over the past 60 years, Autry Stevens has held nearly every job in the oil industry, from truck driver to driller to engineer.
Now he is about to be crowned America's richest oil tycoon.
On Monday, Diamondback Energy Inc. agreed to buy Stevens' Endeavor Energy Resources LP for $26 billion in cash and stock. The sale moves Mr. Stevens from No. 130 to No. 64 on the Bloomberg Rich List, making him the richest oil driller in the country with a net worth of $25.9 billion based on Diamondback's current stock price.
This size of wealth would exceed the $15.4 billion net worth of Harold Hamm of Continental Resources and the $17 billion net worth of Hilcorp Energy's Jeff Hildebrand. Charles and Julia Koch, owners of conglomerate Koch Industries, are wealthier, but oil is only one part of their diverse fortune.
The sale of Endeavor is expected to be completed in the fourth quarter.
The deal ends years of speculation over who would buy Endeavor, one of the last remaining major producers in the shale-rich Permian region. The son of peanut and melon farmers, Mr. Stevens, 85, moved to Midland, Texas, in 1979 after working for Humble Oil, now part of Exxon Mobil Corp., and stints at the Army Corps of Engineers and Midland Bank. Established a company based in As an oil and gas appraiser.
Initially, his early business focused on providing ad hoc engineering assistance. Over time, it expanded to include trucking, well services, and rustabout construction. One thing he was consistent about was buying drilling rights in Texas and never selling them. Mr. Stevens bought his first Permian rights soon after leaving the bank and continued even as his production declined in the 1980s and 1990s, when big oil companies left for more lucrative opportunities overseas.play video
His insistence on using cash rather than debt to acquire drilling rights helped him survive the 2008 financial crisis that devastated oil demand and bankrupted some U.S. executives. Stevens was forced to shut down nearly all of his rigs. The strategy worked, and oil prices soon rose above $100 per barrel.
But it was advances in horizontal drilling and hydraulic fracturing that revolutionized the fortunes of the U.S. oil industry, and few companies stood to benefit more than Stevens. He ultimately amassed drilling rights for 344,000 acres in the heart of the Permian Basin, about 400 times the size of Central Park.
“This is comparable to any square footage in North America,” Diamondback Chief Financial Officer Case Van't Hoff told analysts and investors on a conference call announcing the deal. “Mr. Stevens has had leases in this basin for 45 years, and many of those leases were purchased before we existed at Diamondback.”
As the majors returned to the Permian in the 2010s and domestic oil drillers grew, speculation grew about when Stevens might sell or take Endeavor public. Despite offers from bankers and potential acquirers, he resisted, preferring to expand his production himself. Endeavor ended up becoming “the crown jewel of private enterprise in the Permian Basin,” said John Freeman, an analyst with Houston-based Raymond James Financial.
Those close to Stevens praise his work ethic and commitment to the Permian despite the massive oil price collapses of 2014 and 2020.
The terms of the sale mean Stevens will maintain a foothold in the industry he has spent his life shaping. After the merger, Mr. Stevens and his family, who are Endeavor's sole stockholders, will own just under 40% of the combined company's stock. He is also ready to receive $8 billion in cash. Mr. Stevens' daughter, Lyndal Gress, an attorney, serves as vice chair of Endeavor's board of directors.
Mr. Stevens, who has controlled Endeavor for decades, will not serve on Diamondback's board of directors, which will lead the combined company, the people said. Stevens said he has confidence in current and former Endeavor CEOs Lance Robertson and Chuck Meloy, who will join Diamondback's board of directors.
Other terms of the contract also reassured Stevens. Endeavor employs 1,200 people, and ensuring there were no layoffs was important to the founders, as was keeping the company in Midland, the people said. The fact that the acquiring company was headquartered across the street and that his boss was Travis Stith, whom Stevens had known for years, was key.
Stevens also saw similarities with these companies. That means a similar ethos focused on maintaining lean staff, efficient operations and improving both the oil business and the wider Midland community.
