Exxon kicks U.S. shale drive into high gear with Texas deals

Exxon Mobil stepped up its buying spree in U.S. shale fields with the acquisition of drilling rights to 48,000 acres in the Permian Basin of West Texas on Thursday.

The pair of deals involved a purchase and a so-called farm-in agreement that allows Exxon to obtain stakes in oil discoveries in exchange for shouldering part of the drilling costs. The agreements are the Irving-based company’s fourth and fifth transactions in the region since January 2014, Exxon said in a statement.

The terms of the deals were not announced, nor were the sellers disclosed. The assets will be overseen by XTO Energy in Fort Worth, the shale-drilling specialists acquired by Exxon for $35 billion in 2010.

Rex Tillerson, Exxon’s chairman and CEO, unveiled plans in March to double crude output from its U.S. shale fields during the next three years, even as low prices prompt a more cautious approach to investments elsewhere in the world.

Decades after quitting many U.S. fields to pursue bigger reserves in the North Sea and Africa, Exxon now sees its U.S. shale as among its most reliable cash generators.

Recent drilling in the area “demonstrates the significant potential” of multiple layers of shale in the Permian, XTO President Randy Cleveland said in the statement.

The U.S. contribution to Exxon’s supply has risen for the past few years amid Tillerson’s renewed focus on domestic shale. U.S. wells accounted for 22 percent of Exxon’s crude output in 2014, up from 15 percent in 2008. Besides the Permian Basin, Exxon is looking to onshore fields in North Dakota and Oklahoma to boost production.

Exxon shares (ticker: XOM) rose 92 cents to $78.09 on the New York Stock Exchange.

This story was originally published August 6, 2015 at 5:45 PM with the headline "Exxon kicks U.S. shale drive into high gear with Texas deals."