Exxon pays $31bn for US gas leader
Image via Wikipedia
Exxon Mobil, the biggest US oil company, yesterday agreed to buy XTO Energy for $31 billion (R230bn) in a bet that US emissions restrictions would spur increased demand for natural gas. The transaction values XTO, the largest producer of US natural gas, at $51.69 a share, 25 percent higher than its last closing price. "This says that Exxon isn't shy about stepping up exposure to the natural gas market," said an analyst. – Bloomberg
Exxon Mobil Chief Executive Rex Tillerson said that the company values XTO both for its exceptional expertise in "unconventional" natural gas drilling and for its large U.S. natural gas and oil reserves.
Tillerson said natural gas is the fastest-growing major energy source globally.
XTO is among the leading U.S. gas producers, with reserves equivalent to about 45 trillion cubic feet of natural gas.
XTO Chairman Bob Simpson said that Exxon Mobil, "will build on our success and open new opportunities for the development of natural gas and oil resources on a global basis."
Wall Street voiced optimism about the transaction.
