(Bloomberg) -- Denbury Inc., an independent oil company based in Plano, Texas, has been exploring options including a sale, according to people with knowledge of the matter.

The company, which has a market capitalization of about $4 billion, has been working with an adviser to evaluate strategic options, said the people, who asked not to be identified because they weren’t authorized to speak publicly. Deliberations may not lead to a transaction, the people said. A representative for Denbury declined to comment. 

The stock rose as much as 12.8% to $88.99 a share, the highest since November, after Bloomberg reported the news. The shares were up 10.3% at 2:30 p.m. in New York. 

High oil and gas prices following Russia’s invasion of Ukraine have sparked off a round of dealmaking among independent US producers in recent weeks. Centennial Resource Development Inc. agreed to merge with private producer Colgate Energy in a $2.5 billion deal in May, while Devon Energy Corp. announced a plan to buy Validus Energy for $1.8 billion earlier this month.

Denbury exited bankruptcy in September 2020, in a deal that eliminated $2.1 billion in bond debt and handed control of the company to creditors. The firm, led by President and Chief Executive Officer Chris Kendall, specializes in enhanced oil recovery, or EOR. The process uses carbon dioxide to extract oil from fields on the Gulf Coast and Rocky Mountains that have previously been exploited by other firms, according to its website.

For more than a decade, EOR was viewed as an expensive way to recover crude, especially as US shale producers developed more efficient fracking technology. But the method has recently come back in vogue for its potential to pump more carbon dioxide into the ground than would be emitted from burning the oil. Denbury says about a quarter of its production is considered carbon negative, or so-called blue oil.

The company also has plans to expand carbon capture and storage, which recently received a major boost from the expansion of tax credits within the Inflation Reduction Act, signed into law Tuesday. This year it plans to sign deals to transport and store 10 million tons of carbon dioxide annually that is being emitted by industrial sites. The company has 1.5 billion tons of carbon storage potential along the Gulf Coast including sites in Texas, Louisiana and Alabama. 

Denbury has a goal to fully offset its emissions and those of its customers within the decade, in one of the most aggressive net-zero targets of in the US oil and gas sector.

(Updates with CCS plans in 7th paragraph.)

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