Exxon Signals Appetite for Growth Through M&A

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An Exxon Mobil executive hinted Tuesday that the supermajor would consider growing production through acquisitions as well as through the drillbit.

“We see growth in our oil and gas business, and we’re very focused on exploration, acquisitions and divestments to continue to provide that growth in a way that is more profitable than before, and has the lowest possible emissions,” Exxon President of Upstream Liam Mallon said at the Energy Intelligence Forum.

Mallon did not say what kind of acquisitions or sales the company would pursue; however, he said the company would stick with its strategy to make investments at a cost of supply within a $10-$35 per barrel range. He also said Exxon sees the biggest value for new investments in the areas of LNG, deepwater and unconventional assets.

Long-Term Growth

Exxon is already forecasting massive growth in the Permian Basin, with a 25% increase in production this year compared to 2021.

While the shale sector is already showing signs of maturing as operators drill up their best acreage, Mallon was confident that Exxon can continue to grow production through the end of the decade and beyond.

That’s because of improved efficiencies and technology such as automation, he said.

“Many of the technologies that unlocked [shale] in the first place, like horizontal drilling and fracking, are now having significant science applied to them,” he said. “In the early days, it was more of an experimentation. So if you think about it, you could unlock another 5% to 10% recovery, and do it at a reasonable cost and do it with net zero, which is what we're proposing to do by 2030.”


Oil and gas advocates have warned for years about the effects of declining investment in upstream projects; those warnings were thrown into sharp relief earlier this year when Russia invaded Ukraine, forcing European buyers to scramble for other supplies.

But Mallon told the Forum that underinvestment was not as bad as it seemed, since efficiencies allow operators to produce more hydrocarbons with less cash.

“I think it's a bit misleading to look at absolute numbers and conclude that the productivity of that number is the same today as it was just four years ago,” Mallon said.

For example, Exxon has reduced its Permian rig count from around 50 to the mid-teens in four years without decreasing production. Completion costs have fallen “by a factor of four,” he added.

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