Exxon, Chevron See Consolidation in Top U.S. Shale Field

September 4, 2019

The two largest U.S. oil and gas companies on Tuesday left the door open for more acquisitions in the country's top shale field.

Exxon Mobil Corp expects to see industry consolidation to happen "over some period of time," in the Permian Basin in west Texas and New Mexico, Chief Executive Darren Woods told investors at a Barclays energy conference in New York.

If Exxon sees an opportunity it has the balance sheet to "be in a position to transact on that," Woods said, but he added that "time's on our side."

Chevron Corp also will take an "opportunistic" approach in the basin, said Jeff Gustavson, vice president of Chevron's Mid-Continent business, at the Barclays conference.

"We're always looking," but Gustavson said the company is not under "any pressure to transact."

"I think we demonstrated that earlier this year," Gustavson added. Chevron had struck a deal this spring to buy Anadarko Petroleum, which ultimately accepted a higher offer from Occidental Petroleum. Chevron did not make a second bid for Anadarko and its Permian Basin holdings.

Woods this year set a target of raising $15 billion by trimming Exxon's portfolio through 2021 above the average $3.3 billion a year rate between 2013 and 2017. Sales so far have been sluggish.

But Exxon could increase its planned $15 billion divestment program if "if we continue to capture more attractive opportunities," Woods said Tuesday. 

(Reporting by Jennifer Hiller; Editing by Steve Orlofsky)



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