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Subsequent Events
 12 Months Ended
Dec. 31, 2020
Subsequent Events [Abstract]  
Subsequent Events Subsequent Events
Dividends. In February 2021, the board of directors declared a cash dividend of $0.56 per share on the Company's outstanding common stock, payable April 14, 2021 to stockholders of record at the close of business on March 31, 2021.
Parsley Energy Acquisition. On January 12, 2021, the Company acquired Parsley Energy, Inc., a Delaware corporation that previously traded on the NYSE under the symbol "PE" ("Parsley"), pursuant to the Agreement and Plan of Merger, dated as of October 20, 2020, among Pioneer, certain of its subsidiaries, Parsley and Parsley's subsidiary, Parsley Energy, LLC (the "Parsley Acquisition"). On the closing date of the Parsley Acquisition, Parsley merged into a newly formed wholly owned subsidiary of the Company, and the subsidiaries of Parsley, including Jagged Peak Energy LLC ("Jagged Peak"), became indirect subsidiaries of the Company.
As part of the Parsley Acquisition, each eligible share of Parsley Class A common stock and each membership interest unit of Parsley Energy, LLC were automatically converted into the right to receive .1252 shares of Pioneer common stock. As a result, the Company issued approximately 52 million shares of Pioneer common stock upon the consummation of the Parsley Acquisition, representing total stock consideration transferred of approximately $7 billion.
Acquisition costs of $10 million related to the Parsley Acquisition are included in other expense in the Company's consolidated statements of operations for the year ended December 31, 2020. The acquisition will be accounted for as a business combination, with the fair value of consideration allocated to the acquisition date fair value of assets and liabilities acquired. Parsley's post-acquisition date results of operations will be incorporated into the Company's interim condensed consolidated financial statements for the three months ended March 31, 2021.
Parsley is considered a related party as Bryan Sheffield, Parsley's Executive Chairman and one of Parsley's largest stockholders, is the son of Scott Sheffield, Chief Executive Officer of the Company.
First Amendment to Credit Agreement. On January 12, 2021, Pioneer entered into the First Amendment to Credit Agreement (the "Amendment") with Wells Fargo Bank, National Association, as Administrative Agent, and the other agents and lenders party thereto. The primary changes attributable to the Amendment were to increase the aggregate loan commitments from $1.5 billion to $2.0 billion, extend the maturity of the credit facility to January 12, 2026 and to nominally adjust the drawn and undrawn pricing.
Senior notes. On December 30, 2020, Parsley and the other issuers of their senior notes delivered notices of conditional redemption for the Parsley 5.250% Senior Notes due 2025 and the Parsley 5.375% Senior Notes due 2025. Additionally, Pioneer issued a cash tender offer notice to purchase any and all of the Parsley outstanding 5.625% Senior Notes due 2027 and 4.125% Senior Notes due 2028. On January 14, 2021, Pioneer delivered an additional conditional notice of redemption for the Jagged Peak 5.875% Senior Notes due 2026.
In January 2021, the Company issued $750 million of 0.750% Senior Notes that will mature January 15, 2024, $750 million of 1.125% Senior Notes that will mature January 15, 2026 and $1.0 billion of 2.150% Senior Notes that will mature January 15, 2031 (the "January 2021 Senior Notes Offering"). The Company received proceeds, net of $18 million of issuance costs and discounts, of $2.5 billion. Interest on each of the new notes will be payable on January 15 and July 15 of each year. The senior notes are unsecured obligations ranking equally in right of payment with all other senior unsecured indebtedness of the Company.
The Company used the proceeds from the January 2021 Senior Notes Offering to (i) pay $1.6 billion to redeem Parsley's 5.250% Senior Notes due 2025, Parsley's 5.375% Senior Notes due 2025 and Jagged Peak's 5.875% Senior Notes due 2026, and (ii) pay $852 million to purchase a portion of Parsley's 5.625% Senior Notes due 2027 and Parsley's 4.125% Senior Notes due 2028 pursuant to a cash tender offer. In connection with the tender offers, the Company also obtained the requisite consents from holders of Parsley's 5.625% Senior Notes due 2027 and 4.125% Senior Notes due 2028 to amend the indentures pursuant to which the notes were issued to, among other things, (i) eliminate substantially all of the restrictive covenants and related provisions and certain events of default contained in each indenture and (ii) shorten the minimum notice requirement for optional redemptions to three days.
The Company's outstanding 3.45% Senior Notes matured on January 15, 2021. The Company funded the payment of the $140 million principal balance with cash on hand. See Note 7 for additional information regarding the Company's 3.45% Senior Notes.
February 2021 Winter Storm. During February 2021, the Company's operations in West Texas were significantly impacted by winter weather that brought abnormally cold temperatures, along with snow and icy conditions across the state of Texas. The extreme winter weather impacted production operations, midstream infrastructure and power providers throughout the state, along with many other services. As a result, most of the Company's production was offline for about a week, which is expected to impact first quarter 2021 production by approximately 30 MBOPD and 55 MBOEPD.
Early in the weather event, the Company attempted to perform or otherwise satisfy its firm gas sales commitments, but as the impacts of the winter weather became clearer, the Company subsequently issued force majeure notices to its customers given the inability to perform such contracts for a variety of reasons, including significant production being offline, interruptions to midstream operations, the inability to flow gas to markets due to infrastructure downtime and compliance with government orders to direct any available gas volumes towards supporting power generation. Certain of the Company's customers have alleged that the Company's force majeure notices were improper under the applicable contracts. The Company estimates that it incurred incremental cash costs of $75 million to $85 million in connection with its firm gas sales commitments early in the weather event.