ExxonMobil’s plan to put $41 billion into the purchase XTO Energy Inc. has Louisiana oil and gas officials riding a natural gas high. “Exxon’s purchase of XTO is yet another example of how important a role natural gas is going to play in the future of our country,” says Gifford Briggs, vice president of the Louisiana Oil and Gas Association, which has spent the past year pushing clean-burning natural gas as the country’s bridge fuel for the 21st century.
“As Shell, BP and Exxon become more involved in shale plays and the development of natural gas, it should be a sign to all of us that a shift in America’s energy focus has begun,” Briggs adds, noting that the deal also speaks volumes about the importance of north Louisiana’s Haynesville Shale to the U.S. energy market. “In the Haynesville Shale Exxon now has a foothold in the largest natural gas play in the country."
The all-stock transaction announced yesterday will enhance ExxonMobil’s position in the development of unconventional natural gas and oil resources.
ExxonMobil has agreed to issue 0.7098 common shares for each common share of XTO, which represents a 25 percent premium to XTO stockholders. The transaction value includes $10 billion of existing XTO debt and is based on the closing share prices of ExxonMobil and XTO on Dec. 11, 2009.
“XTO is a leading U.S. unconventional natural gas producer, with an outstanding resource base, strong technical expertise and highly skilled employees,” said Rex W. Tillerson, chairman and chief executive officer of Exxon Mobil Corporation, in announcing the deal. “XTO’s strengths, together with ExxonMobil’s advanced R&D and operational capabilities, global scale and financial capacity, should enable development of additional supplies of unconventional oil and gas resources, benefiting consumers both here in the United States and around the world.” Tillerson also called the agreement good news for the U.S. economy and energy security, as it will enhance opportunities for job creation and investment in the production of America’s own clean-burning natural gas resources.
XTO’s resource base is the equivalent of 45 trillion cubic feet of gas and includes shale gas, tight gas, coal bed methane and shale oil. These will complement ExxonMobil’s holdings in the United States, Canada, Germany, Poland, Hungary and Argentina.
Once the transaction closes -- it is subject to XTO stockholder approval and regulatory clearance -- ExxonMobil will establish a new upstream organization to manage global development and production of unconventional resources, enabling the rapid development and deployment of technologies and operating practices to increase production and maximize resource value. The new organization will be located in Fort Worth, in XTO’s current offices.
“XTO has a proven ability to profitably and consistently grow production and reserves in unconventional resources,” said Bob R. Simpson, chairman and founder of XTO. “As the world’s leading energy company, ExxonMobil will build on our success and open new opportunities for the development of natural gas and oil resources on a global basis.”
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The Catholic Diocese of Lafayette says a 1992 investigation cleared the Rev. Gilbert Dutel of pedophilia allegations, yet when asked to produce those records, church officials came up empty-handed.
The former president and longtime board member of the Council on the Development of French in Louisiana has taken a Texas lawmaker to task over his use of the slur “coonass” during a legislative hearing.
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A Senate Bill passed Thursday now awaits the president’s signature authorizing long-awaited reforms of the Veterans Affairs Administration, including new clinics for Lafayette and Lake Charles.
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