Diamondback nears $5bn deal to expand drilling in oil-rich Permian Basin

Diamondback Energy, a leading US shale producer, is on the verge of finalizing a significant $5 billion acquisition to bolster its presence in the oil-rich Permian Basin in Texas, according to a report by the Financial Times. The deal involves the purchase of Double Eagle V, a drilling portfolio backed by private equity firm EnCap Investments.

Double Eagle V is currently managed by private equity firm EnCap Investments. If finalized, this acquisition will enable Diamondback to expand its operations within the Permian Basin, a region already central to its strategic growth plans.

This potential deal marks a continuation of Diamondback's recent aggressive expansion strategy. Just last week, Diamondback sealed a $26 billion purchase of Five Point Infrastructure's 70% stake in Deep Blue Midland Basin, a key water infrastructure firm in the Permian Basin.

The company's ambitions are further highlighted by its recent $4.08 billion acquisition of certain Double Eagle units in February 2025. These moves position Diamondback as a formidable player in the Permian Basin, a region known for its vast oil reservoirs.

As of now, the deal is expected to be announced within the coming week, pending final negotiations. The transaction is anticipated to involve a mix of cash and stock, further diversifying Diamondback's investment portfolio.