- Autry Stephens, whose parents were peanut and melon farmers, started his Texas company in 1979.
- For sixty years, he's done it all in the oil world, from driving trucks to drilling wells to engineering.
- Now, he's on track to become the wealthiest oil boss in the U.S.
- Yet, the 85-year-old hasn't planned what he'll do with his billions.
- The sale will make his company one of the top drilling operators ready to benefit from Texas' oil surge.
Diamondback Energy is buying Autry Stephens's company, Endeavor Energy Resources, for $26 billion. This deal (learn more) will make Stephens the richest oil driller in the U.S., with a $25.9 billion fortune, jumping him up to 64th place on a list of the world's richest people. He'll be wealthier than other big names in oil, like Harold Hamm with $15.4 billion and Jeff Hildebrand with $17 billion. However, Charles and Julia Koch are still richer, but their money comes from different businesses, not just oil.
The sale is expected to finish in the last part of the year.
This deal is part of a bigger trend where oil companies are buying up more land for drilling to make more money and secure their futures. It's part of a $150 billion wave of oil company deals. This activity is shaking things up far beyond Texas and New Mexico's Permian Basin, affecting global oil supply and prices.
Who is Autry Stephens?
Autry Stephens, who grew up in a family of peanut-and-melon farmers, started Endeavor in Midland, Texas, in 1979. Before that, he worked for what is now Exxon Mobil, served in the Army Corps of Engineers, and evaluated oil and gas for a Midland bank.
Initially, Stephens's company offered engineering services, but it grew to include trucking, well services, and construction. He always focused on buying drilling rights in Texas and held onto them, even when others sold theirs. After leaving the bank, he quickly bought rights in the Permian Basin and kept buying through the 80s and 90s, a time when many big companies left for opportunities abroad.
Autry's choice to use cash instead of loans to buy drilling rights helped his company survive the 2008 financial crisis, which hit the oil industry hard. Although he had to shut down almost all his rigs, the strategy worked well when oil prices soared past $100 a barrel.
The real boss came with the introduction of horizontal drilling and hydraulic fracturing, which dramatically changed the U.S. oil industry's fortunes. Stephens, with drilling rights to 344,000 acres in the heart of the Permian Basin, was perfectly positioned to benefit from these technological advances.
Mr. Stephens's Relationships
“That's as good as any acreage in North America. Mr. Stephens has been working leases in this basin for 45 years, and a lot of those leases were bought before we even existed at Diamondback.”
- Kaes Van't Hof, CFO at Diamondback
In the 2010s, as big oil companies came back to the Permian and domestic drilling expanded, people wondered if Autry Stephens would sell Endeavor or make it public. Despite interest from bankers and buyers, he chose to keep growing the company himself, making Endeavor a top private firm in the Permian Basin.
Those close to Stephens admire his dedication to the Permian, even during the tough times of oil price drops in 2014 and 2020.
With the sale, Autry will still have a significant role in the industry, owning nearly 40% of the new company and getting $8 billion in cash. His daughter, Lyndal Greth, who is a lawyer and vice chair of Endeavor's board, shows the family's ongoing involvement.
Autry Stephens, after years at the helm, won't join the board of the merged companies but trusts Endeavor's current and former CEOs, Lance Robertson and Chuck Meloy, who will.
The deal's terms also meant a lot. It was crucial that Endeavor's 1,200 employees kept their jobs and that the company stayed in Midland. The fact that Diamondback's headquarters is just across the street and led by Travis Stice, whom Stephens knows well, helped seal the deal. Stephens valued the similarities between the two companies, including a focus on efficiency, a small team, and a commitment to improving the oil industry and Midland.
