ExxonMobil doubles Permian Basin presence with Pioneer buy

  • Investing.com
ExxonMobil doubles Permian Basin presence with Pioneer buy
Credit: © Reuters.

SPRING, Texas - Exxon Mobil Corporation (NYSE: NYSE: XOM ) has completed the acquisition of Pioneer Natural Resources Company (NYSE: NYSE: PXD ), a move that significantly expands its operations in the Permian Basin. The merger, which was finalized today, effectively more than doubles ExxonMobil's footprint in the region, bringing its total acreage to over 1.4 million net acres.

The transaction combines Pioneer's substantial Permian assets and expertise with ExxonMobil's financial strength and technological capabilities. As a result, ExxonMobil's daily production in the Permian is projected to surpass 1.3 million barrels of oil equivalent per day (MOEBD) based on 2023 figures, with expectations to reach approximately 2 MOEBD by 2027.

ExxonMobil's Chairman and CEO Darren Woods commented on the merger, highlighting the combined company's potential for increased efficiency and reduced environmental impact. The acquisition is also set to accelerate Pioneer's net-zero emissions goal for its Permian operations from 2050 to 2035.

In line with its commitment to environmental stewardship, ExxonMobil plans to leverage its leading greenhouse gas reduction strategies to hasten the achievement of net-zero Scope 1 and Scope 2 emissions from its unconventional Permian operations by 2030.

The company aims to apply advanced technologies to monitor and mitigate methane emissions and increase the use of recycled water in its Permian fracturing operations to over 90% by the end of the decade.

This merger is part of ExxonMobil's broader strategy to enhance its portfolio of resources and maintain its position as a major player in the fuels, lubricants, and chemicals industries. With its 2030 emission-reduction plans and ambitions for net-zero Scope 1 and 2 emissions by 2050, ExxonMobil is actively pursuing advancements in climate solutions.

The details provided are based on a press release statement issued by Exxon Mobil Corporation.

InvestingPro Insights

Exxon Mobil's (NYSE: XOM) strategic acquisition of Pioneer Natural Resources not only expands its Permian Basin operations but also underscores its robust financial standing and commitment to sustainable practices. InvestingPro data highlights the company's substantial market presence with a market capitalization of 458.26 billion USD, reflecting investor confidence in its business model and growth prospects.

With a Price/Earnings (P/E) ratio of 14.3 and an adjusted P/E ratio for the last twelve months as of Q1 2024 at 13.17, ExxonMobil trades at a valuation that suggests a balance between its earnings track record and market expectations for future growth. This is further reinforced by a Price/Book ratio of 2.23, indicating that the stock may be reasonably valued in relation to its net assets.

One of the InvestingPro Tips for ExxonMobil is its long history of dividend reliability, having raised its dividend for 41 consecutive years. This consistency is a testament to the company's financial health and its ability to generate cash flow, which is crucial for investors seeking stable income streams. Moreover, the company's dividend yield as of the date provided stands at 3.27%, coupled with a dividend growth of 4.4% over the last twelve months as of Q1 2024.

For readers looking to delve deeper into ExxonMobil's financial metrics and strategic outlook, InvestingPro offers additional insights. There are 10 more InvestingPro Tips available, which can provide a comprehensive understanding of the company's performance and potential. To explore these tips and gain an edge in your investment research, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at https://www.investing.com/pro/XOM.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or

100