Oil and gas companies in the US have been on a consolidation tear, and industry watchers predict it isn’t over.

Last year, crude oil and natural gas exploration and production companies increased spending on mergers and acquisitions to $234 billion, the biggest amount adjusted for inflation since 2012, according to data from the Energy Information Administration.

The latest tie-up, announced on Wednesday, involves Houston-based ConocoPhillips (COP) and Marathon Oil (MRO) in a deal valued at $22.5 billion, including debt.

“They’re all the same underpinnings. It’s buying acreage, it’s buying inventory,” Matt Willer, managing director of capital markets and partner at Phoenix Capital, told Yahoo Finance. He added, “Now recognizing that oil and gas isn’t going anywhere likely during our lifetime, [the oil producers] have to make up for lost time.”

Willer says the wave of mergers and acquisitions in the energy space comes after more than a decade of underinvestment amid political and regulatory uncertainty over the oil and gas landscape as the US transitions to green energies.

The appetite for oil and gas has only grown over the last year as US oil production hit new highs after Russia’s invasion of Ukraine temporarily sent prices past $130 a barrel in 2022.

ExxonMobil recently acquired Pioneer Natural Resources. (AP Photo/Mark Humphrey, File)ExxonMobil recently acquired Pioneer Natural Resources. (AP Photo/Mark Humphrey, File)

ExxonMobil recently acquired Pioneer Natural Resources. (AP Photo/Mark Humphrey, File) (ASSOCIATED PRESS)

On the heels of record profits and strong balance sheets, consolidation went into full swing last year with two of the biggest deal announcements since Occidental Petroleum (OXY) acquired Anadarko Petroleum in 2019.

In October ExxonMobil (XOM) announced a $60 billion acquisition of Pioneer Natural Resources. More than a week later, Chevron (CVX) said it would buy Hess Corporation (HES) for $53 billion.

Among other deals announced last year was Tulsa, Okla., based ONEOK (OKE) acquiring Magellan Midstream for $18.8 billion, forming one of the largest US energy pipeline companies.

At the end of last year, Occidental Petroleum agreed to buy privately held CrownRock in a cash-and-stock deal valued at $12 billion.

In January, Chesapeake Energy (CHK) said it would buy Southwestern Energy (SWN) in an all-stock deal valued at $7.4 billion.

The following month, Diamondback Energy (FANG) announced it was buying Endeavor Energy (EDR) for $26 billion.

ConocoPhillips is buying Marathon Oil in a deal valued at $22.5 billion, including debt. (AP Photo/Matt Rourke, File)ConocoPhillips is buying Marathon Oil in a deal valued at $22.5 billion, including debt. (AP Photo/Matt Rourke, File)

ConocoPhillips is buying Marathon Oil in a deal valued at $22.5 billion, including debt. (AP Photo/Matt Rourke, File) (ASSOCIATED PRESS)

More acquisitions are expected, according to a survey of oil and gas executives conducted by the Federal Reserve Bank of Dallas.

Among those who responded, 77% said they anticipate more M&A activity in the next two years.

Among large-cap companies surveyed, 35% said their main goal this year was to acquire assets.

Now that the biggest players have announced their acquisitions, industry watchers expect smaller deals to follow suit.

“I think this is all about consolidating into a smaller number of players in a very mature industry that is looked at as something that is not going to last forever,” Sarah Hunt, Alpine Saxon Woods chief market strategist, told Yahoo Finance.

“Nobody wants to end up being too small to compete with some of the big guys. So I think you will see some of this continue,” Hunt said.

Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre.

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