U.S. energy behemoth
) and Rosneft - Russia's biggest oil producer - are making joint
forays into new areas. Back in Aug 2011, the duo had entered into
a long-term strategic cooperation agreement.
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So far, the achievements of the duo include the formation of the
Kara Sea and Black Sea joint ventures, exploration of seven other
licenses in the Russian Arctic and managing the joint West
Siberia tight oil project.
Going forward, the already present Black Sea and Kara Sea joint
ventures, respectively, Tuapsemorneftegaz SARL and Karmorneftegaz
SARL, will implement project activities as operators pursuant to
the agreement with Rosneft, which is the license holder. Rosneft
holds a 66.67% interest and ExxonMobil holds a 33.33% interest in
the two projects. The initial cost of exploration in the two
areas is estimated at more than $3.2 billion, the majority of
which will be dished out by ExxonMobil.
Further, the companies have agreed to move to the next study
phase for an LNG development in the Russian Far East. Pursuant to
the agreement, the parties will undertake work to determine an
LNG plant site, gas liquefaction technologies and the commercial
structure of the project.
The companies sign another agreement for a tight oil pilot
project in West Siberia, where data collection operations are
currently underway. Rosneft will hold a 51% interest and
ExxonMobil will hold a 49% interest in this project.
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
companies given its track record of superior returns on 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