TULSA, Okla. — WPX Energy announced on Monday the company is merging with Devon Energy.
The merged company will be based in Oklahoma City.
Like many of you and your businesses, we are not immune to the effects of what COVID has wrought on the economy and our industry. Quite simply, our world has changed like night-n-day since we announced our HQ plan. Oil prices, oil demand and our stock price are not what they were.
To overcome challenges in our sector, it has become advantageous to increase the scale of our business by merging with Devon, which both increases efficiencies and reduces costs. We recognize this will ultimately impact our employees and our presence here, likely in profound ways. At this point, moving into the new building is an unlikely scenario.
In June 2019, WPX Energy announced the plan to bring their headquarters to downtown Tulsa in the historic Greenwood district, bringing 400 new jobs to Tulsa.
WPX Energy, Williams Production and Exploration, started as a spin-off from the Williams Companies on Jan. 3, 2012 and became an independent corporation, according to the energy company's website. WPX focuses on hydrocarbon exploration, which is the search in the Earth for deposits of hydrocarbons, like natural gas and petroleum, using petroleum geology, according to Wikipedia.
Mayor G.T. Bynum said the city is working "aggressively" to make sure new tenants are found:
The realities of global energy markets necessitate moves like the one announced today. Earlier this year, WPX’s decision to remain and invest in Tulsa was based upon their recognition of the value their employees bring to the company’s overall success. WPX recognized that it was human capital that drove success and laid the foundation for growth. As a city, we remain committed to working with the new leadership team to ensure Tulsans continue to play a critical role in shaping the success of the merged company, and that those displaced by today's announcement are able to quickly transition and continue their contributions to the growth of Tulsa's economy. Further, we are already working aggressively to ensure one of Downtown's most transformational projects continues moving forward and new tenants are identified.
According to an email to WPX Energy employees, closing, subject to certain approvals, is set to take place in early 2021. Until then, both WPX Energy and Devon Energy remain separate companies. Officials said they even expect a few months of an integration period, even after closing. When WPX Energy closes, the CEO role will be transferred to the now WPX CEO, Rick Muncrief, and Devon Energy's CEO Dave Hager will assume the chairmanship role on a new board which includes both Devon and WPX.
Jobs will no doubt be impacted, the extent of which will be determined as we flesh out the new organization. What’s best for shareholders isn’t always what’s best for the people who serve them. This is one of the difficult, painful realities that comes with navigating a market and a time like we’re in. It stings a lot.
WPX Energy officials said they are looking to finish their headquarters building either in its original form or in a modified way. They are also exploring a variety of ways to make this benefit Greenwood and the Arts District.
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