Major US oil company Chevron Corp reaches agreement to acquire rival Noble Energy Inc. for $5 billion, according to Reuters.

It is noted that the planned acquisition could be the largest deal in the oil industry since the start of the coronavirus pandemic.

After the closing of the deal, Noble Energy shareholders will own about 3% of the combined company.

The deal will allow Chevron to increase the company's proven oil and gas reserves by about 18%. Noble has 2.05 billion barrels of proven oil and gas reserves, while Chevron has 11.1 billion barrels.

The purchase will boost Chevron's investment in shale production in the United States and give the company the largest gas field, Leviathan, in the eastern Mediterranean.

As Reuters notes, the fall in oil prices has reduced the value of many energy companies' shares, making them attractive to those who have survived the recession and have the means to buy.

Chevron ended the first quarter with $8.5 billion in cash after canceling its $33 billion purchase of Anadarko in 2019 and became one of the first major oil companies to cut spending during the downturn.