Exxon Mobil is seeking bids for selling U.S. shale gas properties to raise billions of dollars to shed unwanted assets and reduce debt, Reuters reported.
Three years ago, the top U.S. oil producer set a goal of raising $15 billion from sales by December 2021. More recently, it promised to accelerate lagging sales to whittle a record $70 billion debt pile.
The company’s XTO Energy shale unit is seeking buyers for almost 5,000 natural gas wells in the Fayetteville Shale in Arkansas.
The assets are among gas projects with declining production and market value Exxon is selling as it focus on newer ventures in Guyana, offshore Brazil and Texas’s Permian Basin.
Exxon is marketing the properties itself and aims to receive bids by Sept. 16 and close any sale by year-end.
The company has achieved about a third of its three-year, $15 billion sales target. This year, it has received sales proceeds of $557 million through June, and has deals pending valued at more than $2.15 billion.
Exxon acquired the Fayetteville assets in 2010 for $650 million during a shale boom that would change the U.S. energy landscape, leading to an oversupply of gas that pushed prices to record lows and last year. This led Exxon to reduce the value of its U.S. oil and gas holdings by $17.1 billion.
Output in the assets on offer fell by more than half since 2016 to about 160 million cubic feet per day last year, according to Exxon marketing materials seen by Reuters.
The Arkansas properties cover some 416,000 net acres (1,680 square kilometers) and are some of the North American natural gas resources cut last year from Exxon’s development plan. The sale includes 844 operated and 4,104 non-operated wells.
Dallas-based Merit Energy is evaluating the properties. Merit in 2018 purchased about 258,000 acres in the same area from BHP for $300 million.
Exxon, which reported $22.4 billion loss in 2020, is selling dozens of properties in Asia, Africa, the United States and Europe.
The company is prioritizing debt reduction. After total debt last year doubled to almost $70 billion since 2018, Exxon paid off more than $7 billion this year, to reduce its burden to $60.6 billion.
This year, Exxon held talks with Britain’s Savannah Energy over properties in Chad and Cameroon and sold stakes in two deep water oilfields to Occidental Petroleum and others.
Exxon is seeing new interest in its properties with this year’s rebound in oil and gas prices, said Exxon Senior Vice President Jack Williams on July 30.