Exxon Mobil Corp. spent $5.6 billion to double its share of a massive oil and gas reserve to 6 billion barrels in its first big bet since newly minted CEO Darren Woods took over this month.
The oil giant bought 3.4 billion barrels of resource from the reserve, which is part of the prolific Permian Basin, an oil- and natural gas-producing area that stretches from western Texas into the southeastern corner of New Mexico.
That Woods made his first major acquisition in the multinational behemoth’s home country could be seen as a wager on President-elect Donald Trump’s future energy policies. The incoming president promised to spur an “American energy renaissance” ― to use the bubbling words of the country’s top oil and gas lobbying group ― by slashing environmental regulations and subsidies to clean energy companies. He has stacked his Cabinet with nominees that deny climate science and maintain close ties to fossil fuel interests. He even named Woods’ predecessor, Rex Tillerson, as his secretary of state.
Shares of oil, gas and coal companies soared after Trump won the presidency in a surprise victory in November.
“This acquisition strengthens ExxonMobil’s significant presence in the dominant U.S. growth area for onshore oil production,” Woods, 51, said in a statement Tuesday.
Exxon Mobil did not respond to a request for additional comment.
The acquired companies ― it’s unclear how many individual firms were included in the purchase ― hold about 275,000 acres of land in the basin, existing production of more than 18,000 net barrels per day, and tracts of land in other parts of the country. The Bass family ― a prominent Fort Worth, Texas-based clan of four brothers Forbes said inherited a small fortune from their oil tycoon uncle four decades ago ― previously owned the companies.
The acquisition signals that Woods’ plans for Exxon Mobil won’t veer far from Tillerson’s legacy. Under the 64-year-old, Exxon Mobil rebuffed shareholder efforts to push for more renewable investments and force the company to disclose risks associated with climate change. Tillerson repeatedly mocked clean energy, joking once that he wasn’t “really against renewables” because wind turbine operators bought Exxon Mobil’s oil as a lubricant.