) and its subsidiary, XTO Energy, entered into an agreement with
Denbury Onshore, LLC, a subsidiary of oil and natural gas company
Denbury Resources Inc.
), to acquire all of Denbury's Bakken shale assets. The deal will
also increase its production in the Bakken oil shale region.
CHESAPEAKE ENGY (CHK): Free Stock Analysis
DENBURY RES INC (DNR): Free Stock Analysis
EXXON MOBIL CRP (XOM): Free Stock Analysis
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In return, ExxonMobil will pay $1.6 billion in cash and is offering
its stake in the Hartzog Draw field in Wyoming and Webster field in
Texas to Denbury. Currently, the fields produce 3,600 net oil
equivalent barrels per day of natural gas and liquids.
As per the deal terms, ExxonMobil will acquire 196,000 net acres in
North Dakota and Montana. It is expected that the combined acreage
will produce 15,000 barrels of oil and other hydrocarbons per day
in the second half of 2012.
The deal will increase ExxonMobil's stake by 50% in the Bakken
shale region to 600,000 acres. XTO Energy will carry out operations
at Bakken shale acreage.
ExxonMobil's strength lies in its balanced operations, strong
financial flexibility and continuous improvement on efficiency and
cost control. The company's efforts to build an unconventional
resource portfolio both in North America and overseas aims at
increasing production through increased exposure to large energy
resources with long reserve life and low field declines.
Despite the collapse in natural gas prices, Exxon expects
unconventional gas to play a dominant role in future supplies owing
to the rapid decline in conventional production. The company
possesses more than 8 million unconventional acres in North
ExxonMobil, the largest natural gas producer in the U.S., ahead of
Chesapeake Energy Corporation
), carries a Zacks #3 Rank, which is equivalent to a Hold rating
for a period of one to three months. Longer term, we maintain our