Exxon buys natural gas firm XTO in $41bn deal
Tuesday 15 December 2009
The oil giant ExxonMobil placed a $41bn (£25bn) bet on the future of natural gas with the acquisition of Texas-based XTO, putting pressure on its rivals to follow suit.
Major oil companies have been expanding their natural gas operations in the expectation that environmental regulation could force a shift from oil to more clean-burning fuels. XTO has operations across the US and is a specialist in extracting gas from unconventional places such as shale rock.
The deal is the biggest in the US energy sector since Chevron bought Texaco in 2000, and experts said other multinational oil firms were likely to consider acquisitions of their own.
"This is a historic deal that marks a dramatic shift on the part of the premier major integrated firm to bet large on US unconventional gas," said Eric Chenoweth, an analyst at Morningstar.
"Other major integrated firms, both European and domestic, have shown greater interest in unconventional gas over the past year, but this has often involved smaller partnerships. Exxon has brought out its cannons where others have been using small arms."
Exxon paid a 25 per cent premium over XTO's share price on Friday, valuing the equity at $31bn. It will also assume $10bn of the company's debt.
- 1 Keira Knightley topless: Usually conservative actress does own take on #Freethenipple campaign for Interview Magazine
- 2 Oil tanker with $100 million cargo goes missing off Texas coast
- 3 George Galloway left with severe bruising after attack in Notting Hill by man 'shouting about the Holocaust'
- 4 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 5 Lady al-Qa’ida: On the trail of Dr Aafia Siddiqui, the world’s most wanted prisoner
YouTube video posted by Isis militants shows 'execution of 250 Syrian soldiers'
Keira Knightley topless: Usually conservative actress does own take on #Freethenipple campaign for Interview Magazine
Oil tanker with $100 million cargo goes missing off Texas coast
George Galloway left with severe bruising after attack in Notting Hill by man 'shouting about the Holocaust'
A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
Robin Williams Emmys tribute led by Billy Crystal criticised for including 'racist' joke about Muslim woman
The Rotherham child abuse scandal is a tale of apologists, misogyny and double standards
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Scottish independence TV debate: Pumped-up Alex Salmond bounces back in bruising second round against Alistair Darling
Do you realise just how foolish the UK looks?
With Douglas Carswell joining Ukip, my party has taken another giant step forward
- < Previous
- Next >
iJobs Money & Business
Highly Attractive Salary: Austen Lloyd: BRISTOL - This is a very unusual law c...
£35000 per annum: Harrington Starr: Network Engineer (CCNP, CCNA, Linux, OSPF,...
£50000 per annum: Harrington Starr: DevOps Engineer (Systems Administration, L...
£60000 - £70000 per annum: Harrington Starr: A prestigious leading professiona...