Exxon Mobil to Buy Permian Basin Land From Bass Family for More Than $5.6 Billion

By Austen Hufford 

Exxon Mobil Corp. said Tuesday that it was buying land in the much sought after Permian Basin region from the Bass family for $5.6 billion in stock and up to $1 billion in contingent cash payments.

Exxon Mobil is buying companies owned by the oil family closely associated with Fort Worth, Texas, that have an estimated potential for 3.4 billion barrels of oil equivalent production, including in New Mexico's Delaware Basin, an area Exxon Mobil called a "highly prolific, oil-prone" section of the Permian Basin.

Companies have been paying never-before-seen prices for drillable acres in the Permian Basin. Players in the space say land there has layers of oil-bearing rock which are stacked on top of each other and hold substantial oil reserves that can be tapped in tandem, making each acre more valuable than in a typical oil field.

Exxon Mobil said it can use its technological expertise to drill the longest lateral wells in the Basin which can reduce development costs and increase the proportion of estimated reserve that are turned into final products.

The acquired companies hold about 275,000 acres, most of which is in the Permian Basin.

After a prolonged slump, energy prices began to recover and stabilize last year.

Write to Austen Hufford at [e-mail]

(END) Dow Jones Newswires

January 17, 2017 10:02 ET (15:02 GMT)

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