Update, December 11: Occidental Petroleum said it has finalized a deal to acquire CrownRock for $10.8 billion, plus take on $1.2 billion of the Midland company’s debt. In a statement issued by Occidental, Tim Dunn said “Occidental’s purchase of CrownRock is a multi-win proposition for CrownRock, our employees and customers, and our community.”
Tim Dunn contains multitudes. His roles include West Texas billionaire, powerful behind-the-scenes right-wing political activist and donor, Christian nationalist, lay preacher, and grandfather. And he may soon cross another—oilman—off the list, giving him more time for his other interests.
The Wall Street Journal reports that Houston-based Occidental Petroleum is in talks to acquire CrownRock, the jewel of Dunn’s CrownQuest Operating company. CrownRock owns the wells and oil reserves; CrownQuest harvests the fossil fuels. Presumably, after the deal, Occidental would take over operations, leaving CrownQuest with little to do.
The newspaper says the deal could be worth more than $10 billion. Not all of it will go to Dunn. The headline figure includes debt, and a Houston private equity firm, Lime Rock, owns an estimated 60 percent of CrownRock. Still, there’s a lot to go around, and Dunn and his family are in line for a nice payday.
If that happens, the Dunns will have a lot of time on their hands. Tim Dunn is the chief executive of both companies, and three of his sons work at CrownQuest—as chief financial officer, vice president of engineering, and manager of geology, respectively. All of this suggests that a bevy of cash-rich Dunns will be running around Midland in the near future. They aren’t the kind of family to spend lots of time fly-fishing in Wyoming.
Dunn has profoundly shaped the Texas political landscape in recent years. He and a political action committee that he funds back right-wing candidates, including challengers to Republicans he deems too moderate. The PAC in question, Defend Texas Liberty, has been in the news recently for giving Lieutenant Governor Dan Patrick $1 million in cash and a $2 million forgivable loan, which Patrick refused to give back even after the head of the PAC had an hours-long meeting with a prominent white nationalist neo-Nazi leader. This incident only scratches the surface of Dunn’s political activities. If this is what he does as a mere billionaire, the mind boggles at what he might do as a multibillionaire.
The deal also says a lot about the state of the Texas oil industry. Put succinctly, it’s good to control acreage in the Permian Basin. Holdings in the nation’s most valuable oil field are at a premium right now. Earlier this year, ExxonMobil swooped in and acquired Permian giant Pioneer Natural Resources for a cool $64.5 billion. Wall Street is in a mood to look favorably on the largest companies, so Big Oil is looking for ways to get bigger. The result, to quote the Journal: “It’s a seller’s market in the U.S. oil patch.”
For Oxy, the purchase of CrownRock may say a lot about the future of fossil fuels. The Houston company, led by Vicki Hollub, has been making waves by investing in projects to suck carbon dioxide out of the air and store it underground. The CrownRock deal would further underscore that Big Oil doesn’t have to choose between developing fossil fuel reserves and getting into the carbon-wrangling, zero greenhouse gas emissions business. These companies can afford to do both. The approach generates cognitive dissonance, but also potential profits.
Global leaders are now meeting in Dubai for the United Nations’ COP28 climate change summit, at which countries are taking stock of their progress toward meeting commitments to limit greenhouse gas emissions—and making promises about new efforts. According to reporting from the BBC, the host nation, the United Arab Emirates, plans to use the gathering to develop its own new international fossil fuel projects.
Back in Texas, what’s the next shoe to drop? CrownQuest (thanks to the wells owned by CrownRock) was the eighth-largest oil producer in the state last year. Coming in at number five was another private company that could be ripe for the taking: Endeavor Energy Resources, led by octogenarian Autry Stephens of Midland. No doubt investment bankers with PowerPoint presentations are working to convince Stephens that it’s time to sell.
As for Tim Dunn, he’s already working on something new. Texas Monthly reported a couple of months ago that he had invested $5 million in a company built by Donald Trump’s former digital director Brad Parscale, who has moved to Midland. Now Dunn will have more time and cash with which to inject his ideology into the politics of Texas—and potentially the nation.