U.S. energy behemoth
) and Rosneft - Russia's biggest oil producer - have agreed to
establish a joint Arctic Research Center (ARC) in Russia. The duo
also agreed to share technologies for their existing joint
ventures (JVs). The agreements support the companies' August 2011
long-term strategic cooperation agreement. In ARC, Rosneft would
hold a 66.7% stake while the rest will be held by ExxonMobil.
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Going forward, ARC would provide the Rosneft and ExxonMobil JVs a
full range of research, development and technical services, with
near-term focus on the Kara Sea.
The research center would initially focus on safety and
environmental protection; ice, metocean and geotechnical surveys;
sea ice management; development of design criteria; and the
evaluation and design of development concepts.
ExxonMobil would dish out $200 million in funding for the
center's initial research work. The next lot of funding of $250
million for the joint research work would be shared equally by
Rosneft and ExxonMobil.
Exxon Mobil is the world's largest publicly-traded oil company,
engaged in oil and natural gas exploration and production,
petroleum products refining and marketing, chemicals manufacture,
and other energy-related businesses. Approximately 83% of Exxon
Mobil's earnings come from its operations outside the U.S.
Exxon Mobil is one of the world's best-run integrated oil company
given its track record of superior returns on the capital
employed. The energy giant has long been a core holding for
investors seeking a defensive name with continued dividend
growth. Exxon Mobil is fairly active in its investment program.
The company plans to spend about $185 billion over the next five
years, up 29% from the last five-year period.
The capital expenditure covers as many as 21 important oil and
gas projects currently under the anvil and are estimated to
accumulate over 1 million net oil-equivalent barrels per day by
2016. It includes the Kearl Oil Sands development project in
Canada, four in West Africa and Kashagan Phase 1 in Kazakhstan.
Exxon is also engaged in a large liquefied natural gas project in
Papua New Guinea, which is expected to begin deliveries in 2014.
It will unearth more oil from the development of the Hebron oil
field, offshore the Canadian province of Newfoundland and
Labrador. The development will help in recovering over 700
million barrels of oil and the platform is expected to yield its
first oil towards the end of 2017.
Exxon Mobil holds a Zacks Rank #3 (Hold). However, in the near
term, stocks like
Summit Midstream Partners, LP
Ferrellgas Partners LP
) with Zacks Rank #1 (Strong Buy) are expected to outperform the
market over the next few months.