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Exxon Mobil Corporation (XOM)

  • Sep. 25, 2014, 8:55 AM
    • Papua New Guinea wants Total (NYSE:TOT) to lead construction of a new liquefied natural gas export project drawing gas from a disputed field instead of the gas being used to expand an existing project, the country's energy minister says.
    • The country began exports this year from Exxon Mobil's (NYSE:XOM) $19B PNG LNG project, but it is hoping to see TOT lead another export plant even as the PNG LNG expansion moves forward.
    • TOT earlier this year bought a 40% stake in Papua New Guinea's biggest undeveloped gas deposit, the Elk and Antelope fields, from InterOil (NYSE:IOC), but XOM partner Oil Search (OTCPK:OISHF) has challenged TOT's purchase, saying it held the right to buy the stake; the dispute is due to go into arbitration in November.
    • The PNG energy minister says gas from Elk and Antelope was unlikely to be fed into the existing plant, and that he prefers a separate LNG plant to be built.
    | 1 Comment
  • Sep. 24, 2014, 5:24 PM
    • The Russian Arctic is not the only offshore region generating a potential political problem for Exxon Mobil (NYSE:XOM), as Forbes' Tim Threadgold thinks XOM also faces the possible loss of the giant Scarborough gas field off the coast of western Australia.
    • The ultra-deepwater Scarborough is a difficult field to develop, not just because of its location but also because of Australia’s high domestic costs and the gas contains limited amounts of high-profit liquids.
    • Threadgold says a recent statement from partner BHP Billiton (NYSE:BHP) that the company was focusing on North American oil and gas opportunities because they offer higher rates of return on investment could play into the hands of an Australian company - Fortescue Metals (OTCPK:FSUMF) - which would like to own Scarborough, and theoretically could do so without paying XOM and BHP a dollar under Australia's “use it or lose it” laws.
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  • Sep. 23, 2014, 6:49 PM
    • J.P. Morgan's energy analysts say there's little reason to get excited about Exxon Mobil (NYSE:XOM) or Chevron (NYSE:CVX), assigning Neutral ratings to both stocks and saying they should be good enough for 11%-12% total returns including dividends by year-end 2015; the firm's energy group average return is ~15%.
    • JPM views XOM as more macro-oriented and defensive than peers, but also sees unique defensive characteristics such as its top-tier free cash flow yield, free cash flow/dividend coverage ratio and below-average financial leverage, which should allow for favorable return of capital.
    • CVX has an attractive global asset base with the potential for top tier production growth and margins; while free cash flow is currently negative as the Australian LNG investment phase peaks, a potential multi-year improvement could be ahead as these projects move into production mode.
  • Sep. 23, 2014, 2:11 PM
    • Exxon Mobil (XOM -0.3%) and Rosneft (OTC:RNFTF) are continuing to drill in the Kara Sea and plan to stop work by Oct. 10, according to Russia's deputy energy minister.
    • The latest sanctions had called for the removal of U.S. workers on projects in the Russian Arctic by Sept. 26, but the U.S. Treasury Department was expected to offer a short extension to wind down a rig at the well.
  • Sep. 19, 2014, 4:51 PM
    • Exxon Mobil (NYSE:XOM) has put its Torrance, Calif., refinery up for sale, Reuters reports, making it the latest big oil company to consider exiting the state amid tougher environmental standards.
    • The 155K bbl/day refinery, in the south part of Los Angeles, is XOM's only refinery in California and the second smallest of its half-dozen U.S. plants.
    • XOM may have some trouble making a sale, however, because of the state's environmental regulations and since several refiners including Chevron (NYSE:CVX), ConocoPhillips (NYSE:COP), Tesoro (NYSE:TSO) and Valero (NYSE:VLO) already operate two or more refineries there, limiting their ability to buy others.
  • Sep. 19, 2014, 12:45 PM
    • Exxon Mobil (XOM +0.7%) confirms that it will stop drilling an exploratory well in Russia's Kara Sea in compliance with U.S. sanctions against Russia, saying it received a license from the U.S. Treasury Department to wind down operations.
    • The latest round of sanctions had called for the removal of U.S. workers on projects in the Russian Arctic by Sept. 26; it is not clear whether the license will allow XOM to stop drilling on its own schedule.
    • The drilling suspension does not immediately affect oil production for XOM or its Russian partner, Rosneft (OTC:RNFTF), since the project is aimed at deciding if future production would be economically feasible, but a potentially major source of new production could be denied if the suspension lasts.
    | 1 Comment
  • Sep. 18, 2014, 7:15 PM
    • Exxon Mobil (NYSE:XOM) has halted drilling at the Universitetskaya-1 well off Russia's remote northern coast, Bloomberg reports, in what would be the first tangible evidence that sanctions are slowing energy investment in the country.
    • Work is said to have stopped a few days after the U.S. and EU barred companies from helping Russia exploit Arctic, deepwater or shale oil fields.
    • U.S. sanctions gave American companies until Sept. 26 to stop all restricted drilling and testing services, which means XOM and Seadrill's (NYSE:SDRL) North Atlantic Drilling (NYSE:NADL) unit would be under the gun to finish or temporarily seal the $700M well they are developing with Rosneft (OTC:RNFTF).
    • "This has been one of the most-watched wells in the industry, so this is a huge deal," an analyst says.
  • Sep. 18, 2014, 5:23 PM
    • Linn Energy (NASDAQ:LINE) and LinnCo (NASDAQ:LNCO) agree to swap a portion of their Permian Basin properties to Exxon Mobil (NYSE:XOM) for operating interests in California's South Belridge Field.
    • Linn will receive XOM's interest in its Hill Property located in the South Belridge Field, which it believes offers significant upside potential through optimization projects, increased steam injection and extensive down spacing from more than 300 future drilling locations; current production totals ~3.4K boe/day but Linn estimates total resource potential of ~67M boe.
    • In exchange, XOM will receive ~17K net acres in the Midland Basin core area in west Texas that is most prospective for horizontal Wolfcamp and Spraberry development, and now produces ~4.7K boe/day, plus 800 acres in the New Mexico Delaware Basin.
    • The deal is the second such asset swap this year by the companies (earlier).
    • LINE +1.4% AH.
  • Sep. 16, 2014, 4:59 PM
    • Argentina’s oil-producing provinces and the federal government agree to revise a 1967 energy bill to include shale, two provincial officials tell Bloomberg.
    • State-run producer YPF is seen benefiting most from the new legislation, which should ease political tensions stemming from unclear rules governing the country’s shale boom and attract investors to areas such as Vaca Muerta, the huge shale formation where companies such as Chevron (NYSE:CVX), Shell (RDS.A, RDS.B) and Exxon (NYSE:XOM) are drilling wells.
    • The new bill would allow energy companies that invest $250M over a five-year period to sell 20% of production in international markets without paying export taxes and to keep some export revenue outside the country for shale and conventional projects.
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  • Sep. 15, 2014, 6:56 PM
    • Exxon Mobil (NYSE:XOM) and Malaysian partner Petronas have kicked off operations at a massive enhanced oil recovery project offshore Malaysia after nearly three years of construction.
    • XOM says the Tapis EOR project is one of the largest offshore enhanced oil recovery projects in Southeast Asia and represents a $2.6B investment by the company and its 50/50 partner.
    • Tapis R is equipped with compression capacity for 390M cf/day of gas and a water injection capability of 270K bbl/day.
    | 1 Comment
  • Sep. 15, 2014, 11:58 AM
    • North Dakota's daily oil production jumped 5% in July to an all-time high 34.4M barrels (~1.1M bbl/day), state regulators say, although the number was lower than expected as producers worked to meet aggressive flaring-reduction targets.
    • Natural gas production hit 1.3B cf/day, also an all-time high, but the percentage of natural gas flared in the state fell to 26% in July from 30% in June.
    • In an effort to curb flaring, state regulators issued strict goals earlier this year with key benchmarks for flaring percentages each month; for October, for instance, the state's oil producers cannot flare more than 74% of natural gas produced.
    • Bakken producers include CLR, EOG, KOG, WLL, HES, XOM, OAS, NOG, EOX, MRO.
  • Sep. 15, 2014, 10:55 AM
    • Indonesia's oil regulator says he expects crude output from Exxon Mobil's (XOM +0.2%) Cepu oil block to peak in July or August of next year.
    • The Banyu Urip field, part of the Cepu block near Surabaya in East Java, is expected to produce on average 119K bbl/day next year, with a peak of 165K bbl/day.
    • XOM is developing the field along with state energy firm Pertamina.
    | Comment!
  • Sep. 12, 2014, 12:48 PM
    • Exxon Mobil (XOM -1.1%) drifts lower in the wake of expanded U.S. sanctions against Russia, as the new penalties would affect its current Kara Sea drilling with Rosneft (OTC:RNFTF), although the extent of the impact is unclear.
    • The Russian Natural Resource Ministry reportedly is saying that foreign companies will find it difficult to return to Russia after sanctions.
    • WSJ analysis says no other western energy company has as much direct exposure to Russia as XOM, thanks to the $3.2B deal giving the company access to a piece of the Arctic that could hold the equivalent of billions of barrels of oil and gas.
  • Sep. 11, 2014, 7:08 PM
    • After moving back above the $100/share level, Apple (NASDAQ:AAPL) is back over the $600B mark in market cap, pushing it nearly $200B above Exxon Mobil (NYSE:XOM), the next largest company in the U.S.
    • XOM is still valued at more than $400B, but Google (NASDAQ:GOOG) at $397B and Microsoft (NASDAQ:MSFT) - which has surged in 2014, adding $74B in market cap to $386B - are closing the gap.
    • Berkshire Hathaway (NYSE:BRK.B) completes the top five with a $339B market cap; no other companies are worth more than $300B.
    • Rounding out the top 20 market caps: JNJ, WFC, GE, WMT, CVX, PG, JPM, FB, VZ, IBM, PFE, KO, ORCL, T, MRK.
  • Sep. 10, 2014, 5:32 PM
    • The U.S. and EU are said to be close to imposing the toughest round of energy sanctions yet, which would hit both Russia's energy industry and companies such as Exxon Mobil (NYSE:XOM) that are working with Rosneft (OTC:RNFTF) and other state-controlled companies.
    • The sanctions reportedly would ban U.S. and European companies from working with Russia on future oil exploration in the Russian Arctic, deep seas and shale rock formations; the move would go beyond previously reported proposals to widen curbs on technologies for the oil industry.
    • The sanctions would not affect current oil production but could imperil the future of existing partnerships, including a deal between XOM and Rosneft to drill in the Arctic Ocean; other vulnerable oil majors would include BP, Shell (RDS.A, RDS.B), Statoil (NYSE:STO) and Total (NYSE:TOT).
  • Sep. 10, 2014, 3:28 PM
    • Energy stocks, especially refiners, are taking a beating following the latest EIA inventory report that said gasoline stockpiles rose by 2.4M barrels last week, helping send U.S. crude oil futures to 16-month lows (-1.2% to $91.61/bbl) and Brent crude to 17-month lows (-1.1% to $98.02).
    • The report is bearish given the large increases in refined product inventories; "even though the crude drawdown was close to expectations, it seemed to disappoint," Again Capital's John Kilduff says.
    • The EIA report followed the agency’s updated demand growth report issued yesterday and this morning’s release of OPEC’s report on the oil market; both see lower demand growth this year and next.
    • Oil majors are mostly lower: XOM -0.6%, CVX -1.4%, COP -0.3%, but BP (+2.9%) and RDS.A (+1%) are higher.
    • Refiners are hit hard: VLO -3.6%, PSX -1.5%, MPC -1.9%, HFC -2.5%, TSO -2.9%, WNR -4.1%, CVI -1.6%, ALJ -1.8%, PBF -3.5%, DK -1.8%, CLMT -1.8%.
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Company Description
Exxon Mobil Corporation is engaged in energy, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products.