ExxonMobil to Acquire Companies Doubling Permian Basin Resource to 6 Billion Barrels
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Companies’ assets include 250,000 acres in highly prolific Permian
Basin
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Adds more than 3.4 billion barrels of oil equivalent, of which 75
percent is liquids
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Upfront acquisition cost of $5.6 billion to be paid in ExxonMobil
shares
Exxon
Mobil Corporation (NYSE:XOM) said today it will more than double its
Permian Basin resource to 6 billion barrels of oil equivalent through
the acquisition of companies owned by the Bass family of Fort Worth,
Texas, with an estimated resource of 3.4 billion barrels of oil
equivalent in New Mexico’s Delaware Basin, a highly prolific, oil-prone
section of the Permian Basin.
ExxonMobil will make an upfront payment of $5.6 billion in ExxonMobil
shares, and a series of additional contingent cash payments totaling up
to $1 billion, to be paid beginning in 2020 and ending no later than
2032 commensurate with the development of the resource.
Darren W. Woods, ExxonMobil chairman and chief executive officer, said
the high-quality properties are a major addition to ExxonMobil’s
unconventional liquids portfolio managed by its subsidiary, XTO Energy
Inc.
“This acquisition strengthens ExxonMobil’s significant presence in the
dominant U.S. growth area for onshore oil production,” said Woods. “This
investment gives us an exceptional Delaware Basin position in a proven
multi-stacked play that can generate attractive returns in a low-price
environment.
“The highly-contiguous position will provide significant cost advantages
in developing 3.4 billion barrels of resource, of which 75 percent is
liquids. By utilizing ExxonMobil’s technological strength coupled with
its unconventional development capabilities we can drill the longest
lateral wells in the Permian Basin, reducing development costs and
increasing reserve capture.”
The acquired companies, which include the operating entity BOPCO, hold
about 275,000 acres of leasehold, and production of more than 18,000 net
oil equivalent barrels per day, about 70 percent of which is liquids.
This includes about 250,000 acres of leasehold in the Permian Basin, the
bulk of that in contiguous, held-by-production units in the New Mexico
Delaware Basin, with more than 60 billion barrels of oil equivalent
estimated in place. The companies also hold producing acreage in other
areas in the United States.
ExxonMobil is producing approximately 140,000 net oil-equivalent barrels
per day across its Permian Basin leasehold.
About ExxonMobil
ExxonMobil, the largest publicly traded international oil and gas
company, uses technology and innovation to help meet the world’s growing
energy needs. ExxonMobil holds an industry-leading inventory of
resources, is the largest refiner and marketer of petroleum products,
and its chemical company is one of the largest in the world. For more
information, visit www.exxonmobil.com
or follow us on Twitter www.twitter.com/exxonmobil.
CAUTIONARY STATEMENT: Statements of future events or conditions in this
release are forward-looking statements. Actual future results, including
project plans and schedules, resource recoveries, production rates and
cost and performance efficiencies could differ materially due to changes
in market conditions affecting the oil and gas industry or long-term oil
and gas price levels; political or regulatory developments; reservoir
performance; the outcome of future exploration and development efforts;
technical or operating factors; and other factors cited in under the
caption “Factors Affecting Future Results” on the Investors page of our
website at exxonmobil.com. Closing of the acquisition is subject to
satisfaction of conditions precedent specified in the applicable
agreement. References to resources, oil-equivalent barrels and other
quantities of oil and gas include amounts that are not yet classified as
proved reserves under SEC definitions but that we believe will
ultimately be produced and moved into the proved reserve category.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170117005836/en/
Copyright Business Wire 2017
Source: Business Wire
(January 17, 2017 - 9:00 AM EST)
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