Free Republic
Browse · Search
Topics · Post Article

Skip to comments.

ExxonMobil Corporation Makes Moves in Permian Basin, Utica Shale
The Motley Fool ^ | Feb 3rd 2014 | Patrick Morris

Posted on 02/04/2014 8:51:20 AM PST by thackney

Today, ExxonMobil announced it had reached two separate agreements with American Energy-Utica and Endeavor Energy Resources, in Utica, Ohio, and the Permian Basin in Texas, respectively. The agreements will allow Exxon to further expand the assets of its oil and natural gas portfolio in the U.S.

The agreements have been made through ExxonMobil subsidiary XTO Energy, which manages the company's oil and natural gas portfolio in the United States.

The agreement with Endeavor Energy Resources will further increase the holdings of XTO to 1.5 million acres in the Permian Basin, which is a key area of onshore oil production in the United States.

Although Endeavor will maintain its operations of shallow production in the 34,000 gross acres of the agreement, XTO will in turn "drill and operate horizontal wells in the deeper intervals," giving it "substantial operating equity... in the prolific liquids-rich Wolfcamp formation in Midland and Upton counties."

In addition to the agreement with Endeavor, XTO also signed a separate deal with American Energy-Utica (AEU). While XTO will maintain its operations in its core area, which encompasses 55,000 net acres, the agreement announced today will give AEU access to approximately 30,000 acres of XTO's footprint in the Harrison, Jefferson and Belmont counties of Ohio.

The press release highlighted that the reason for the agreement with AEU was to allow XTO to optimize its development in its core area "by using proceeds from the transaction to fund 100 percent of near-term development costs." In total, XTO has approximately 645,000 acres in the Appalachia region, and it grew its production by almost 30% last year.

"These transactions underscore our commitment to developing high-margin liquids growth in areas such as the Permian, while also efficiently funding development of our extensive domestic natural gas resource in emerging plays such as the Utica," said XTO Energy President Randy Cleveland.

TOPICS: News/Current Events; US: Ohio; US: Pennsylvania; US: Texas
KEYWORDS: energy; oilpermian; utica

1 posted on 02/04/2014 8:51:20 AM PST by thackney
[ Post Reply | Private Reply | View Replies]

To: thackney

what they say about Exxon is that they are primarily into cost and risk control. so they are never the first ones into a play but rather once things are established and the risk reward thoroughly understood—they then use their capital base to buy —even pay up if the numbers work— for production.

One counter factual of this is that they committed 600 million to biofuels a couple years back. But I don’t know if this money was ever spent.

2 posted on 02/04/2014 1:19:27 PM PST by ckilmer
[ Post Reply | Private Reply | To 1 | View Replies]

To: ckilmer

And cash flow

3 posted on 02/04/2014 3:10:33 PM PST by thackney (life is fragile, handle with prayer)
[ Post Reply | Private Reply | To 2 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794 is powered by software copyright 2000-2008 John Robinson