An oil executive embroiled in a price-fixing lawsuit will be barred from serving on ExxonMobil's board when the energy giant buys the Texas-based petroleum producer Pioneer Resources, according to three people with direct knowledge of the matter.

The Federal Trade Commission is set to greenlight the $64 billion deal, despite antitrust concerns — but on the condition that Scott Sheffield, Pioneer’s founder, two-time former CEO and current board member, not serve as planned on Exxon’s board, the people said.

The FTC alleges that Sheffield exchanged hundreds of messages with OPEC officials discussing oil output and prices, one of the people said. While OPEC participants have antitrust immunity as sovereign entities, U.S. firms do not. The FTC also has competition concerns about Sheffield’s position on the board of Williams Cos., which is primarily focused on oil and gas transportation, that person said.

Pioneer and other producers in the region have also faced allegations in a private class-action lawsuit of collusion with OPEC to limit oil supplies, and Sheffield, though not a defendant, has factored prominently in the complaint. The FTC is concerned about potential anti-competitive conduct if he remains with the company after the deal closes, according to the people, who were granted anonymity to discuss the confidential matter. Sheffield has not been accused of any wrongdoing.

Any solid evidence of energy price-fixing would be politically explosive, potentially undermining Republicans' accusations that President Joe Biden’s energy policies have saddled motorists with rising fuel costs. But Pioneer and other companies named in the suit, including Diamondback Energy and Hess Corp., have rejected the allegations in a response to the class action claims filed by consumers.

The FTC is expected to announce its decision on the deal as soon as this week, though details of the allegations are typically redacted in court filings.

It couldn’t be learned if the FTC is requiring any other concessions from the companies.

An FTC spokesperson did not respond to a request for comment. Neither did Sheffield or spokespeople for Exxon and Pioneer.

Sheffield had been expected to take a seat on Exxon’s board of directors following completion of the merger, according to a securities filing.

Bloomberg earlier reported that the FTC is expected to clear the deal.

The class-action lawsuit alleges Pioneer and the other companies had for several years coordinated their production decisions with OPEC, which had previously linked their production strategy with Russia under the moniker “OPEC+.”

That lawsuit contends that OPEC’s coordination with the U.S. companies kept production growth rates lower than would be seen in a competitive market, including during the period in 2022 after Russia invaded Ukraine, driving oil prices to record levels. That surge prompted Biden to tap the U.S. Strategic Petroleum Reserve to release 180 million barrels of crude to cool the market, an action that led Republicans to accuse him of leaving the oil stockpile dangerously depleted.

As oil producers found themselves flush with cash, merger activity in Texas’ and New Mexico’s Permian Basin — the largest oil field in the U.S. — has skyrocketed, with more than $200 billion in deals in the last year. Among those are Chevron’s $53 billion takeover of Hess, Occidental’s $12 billion takeover of CrownRock, Diamondback’s $26 billion tie-up with Endeavor and the $24 billion deal between natural gas giants Chesapeake Energy and Southwestern Energy.

The FTC has opened in-depth investigations of all of the above deals. While the agency has challenged energy mergers in the past, it has focused its attention historically on pipeline and retail markets. Given the global market for oil and gas and OPEC’s role in setting prices, cases against U.S. producers are considered difficult.

But U.S. antitrust enforcers have taken a wider look at mergers across the economy, asking how they will affect competition among all companies in a particular industry. That includes whether a particular deal will increase the potential for price-fixing and other collusion.

In its reviews of the current oil deals, the FTC is asking companies for all communications among the companies and any officials at OPEC or OPEC+, according to people involved in the probes and a document POLITICO has seen.

The agreement to bar Sheffield from Exxon’s board would be an unusual way to resolve government concerns that a merger is anti-competitive, but would be both an acknowledgment of the low chances of the government succeeding at blocking the deal in court, and a way to put the industry on notice that it is under intense scrutiny for any possible misconduct.

Dictating board seats is not unheard of, however. In a settlement last year, the FTC prevented a private equity firm from getting a seat on the board of natural gas company EQT as a condition to approving an acquisition.

Pioneer dates back to 1997, and was created after a merger involving another company led by Sheffield. Pioneer is the biggest crude producer in the Permian Basin, whose output is the main reason the U.S. has become the world’s largest oil producer – and has challenged OPEC’s power to influence global crude oil prices in recent years.

The Pioneer takeover represents a huge expansion for Exxon in the region.

Coined pejoratively as the “Mother Fracker” by an activist investor in 2015, Sheffield stepped down from the top post at Pioneer in 2016, only to return three years later. The company announced his retirement in the spring of last year, several months before the Exxon deal was announced last October, but he remains on Pioneer’s board.

While it is not known what exactly the FTC has uncovered, according to the complaint filed in the recent class-action litigation, the “defendants met and communicated regularly with each other, and with OPEC, to coordinate their collective oil output in response to market conditions.”

Sheffield played a key role in those talks dating back to 2017, according to the lawsuits. That led, among other things, to Sheffield correctly predicting an OPEC+ production cut in 2023, according to the litigation.