Last year at this time XTO in the Permian Basin had 50 active drilling units and in 1Q21 XTO had 5 active drilling units. I guess XTO never was able to produce as Neil Chapman repeatedly stated on the corporate website, at investor cars and on the XTO website, "XTO can produce a 10% ROI at $25/bbl." No, XTO can not. In fact, XTO lied about their drilling operational times, their drilling costs, their drilling production, their production costs, they lied about everything. The SEC is going to have a great time discovering all these lies and cover ups over the next few months. Where was the great LNG, XTO's own, America's Infrastructure VP watchful eye and stewardship during all this time? We built a Wink terminal this is 1/3 at capacity, another great investment. And a Wink to Webster pipeline that got started and will never be completed wasting millions more in the corporations dollars. The Woods "Lean Into" Strategy had the Permian at 1M bbl/day by 2024, now the new plan has it at 700k bbl/day by 2025, who knows the right answer, because nobody at XTO, the god pod, or Woods can be trusted to make a decision or tell the truth, much less make a 3-5 year forecast. $40 billion for XTO, plus another $5B for the Permian, $20B in write downs, only the god pod and soon the SEC will know how much money XTO has lost, what another hunk of junk brought to you the top 10% of ExxonMobil Management.
19 replies (most recent on top)
EOG doesn’t have to pay overhead for all the Houston based people like XTO does. Also are the wells exactly the same? There could be a lot of reasons for the cost difference. A well is a well is a well doesn’t hold true.
@2car+1aaUxVLt
I’m guessing you are young? They only post the good ones on Yammer. Delaware is essentially the the old Development Company. The Development company MO is to set goals that are 3x what they should be, and then tell you how good they are when they come in at 2x. I own an interest in an EOG Delaware well. They drilled my well for 25% less than what Exxon spends on their wells. Winning!
I don’t know where you are getting your info but it is wrong. Talk to someone who is actually in the BU or just look on yammer. Drilling out there is k–ling it. They have blown past the plan target long ago.
@1omm is 100% right.
There is at least one federal lawsuit for the false stock-pumping re: XTO.
Manipulation that is.
Not quite as bad as the bribery scandal in large other-continent country.
All this will be catching up eventurally.
Most of the XTO management is ExxonMobil heritage. The XTO employees were run off years ago or quit because they didn’t want to work for Exxon. In the Permian for example people never forgot how Exxon closed shop and left town before shake revitalized the basin. Trying to create an ExxonMobil employees vs XTO employees is a false narrative and shows you aren’t involved in uncon or you would know the people working it are al ExxonMobil transplants to XTO.
Drilling has actually been beating their plan assumptions.
Wrong. The production target would have been hit if demand hadn’t evaporated.
https://www.desmogblog.com/2021/02/26/exxon-reality-bad-fossil-fuel-investment-tar-sands-fracking
XTO is the worst energy acquisition ever made and the entire 40 billion will need to be written off. Article also provides additional information on the SEC investigation.
https://www.wsj.com/articles/exxon-draws-sec-probe-over-permian-basin-asset-valuation-11610716622
Interesting article and indicates quite a large discrepancy in how XTO calculates reserves and the apparent pressure management placed on them to do so; 49 billion vs. 60 billion barrels. This is also the source of not only the SEC investigation but also about 10 class action law suits. Does anyone know who the XTO she in this WSJ article?
ID: @1omm+1aaUxVLt
If 2% learning curve cost savings is all they have, it’s a bigger joke than I thought! LOL
@dks+1aaUxVLt
You do realize that Exxon’s Piceance Creek was giant portion of the write down? It was moved from Exxon to XTO, but had been a colossal failure for Exxon prior to the shift in responsibility.
“Nothing of any significance will come of the SEC investigation. We know the credibility of whistleblowers”
I bet you are wrong on that. The BU manager absolutely put pressure on the Delaware team to pull some BS 2% additional drilling savings per year (on top of their learning curve) in perpetuity. There are emails that nail this person, and this is fairly well known across UNCON (I wasn’t even in the Permian and knew they were doing this).
More delusional ranting Op. Get a grip. But if you just want to complain, you have come to the right place.
Why would we cut CAPEX to such a wonderful project? Chapman and Woods have repeatedly stayed that the Permian would produce an ROI of 10% at $35 per barrel and with crude at $55+ per barrel out production is expected to remain flat for the balance of 2021. So are the economics falsified, is the production a lie, what is the truth? Lomg term commitments on the Wink to Webster pipeline we all no mean absolutely nothing until the pipeline is built and with so much spate capacity in the market we will never build this line so the money we have already spent is wasted. Plus this us sweet crude and nobody in the gulf really wants sweet crude so we were going to double the Beaumont Refinery to handle sweet crude, but of course, that is not going to happen either. So the entire plan is a bust, just like the purchase of the Wink terminal 3 years ago. Yes, XTO is a cult, it is a secret cult, one that was made secret the day we spent and wasted $40 billion dollars on that company, let them run their business in secret in Ft. Worth for a decade making even more wasteful investment decisions and then turned then loose to make even more secret wasteful decisions in the Permian as we sit here today. No I am not a troll. I am an employee, a concerned employee, a shareholder, with a family to support. I am not in the top 20% so I was not one of those making all these awful decisions that led to $20B in XTO write downs and made investments in a terminal at 1/3 capacity and a non operational pipeline, I am not that smart, because I am not in the top 20% and I am not in the XTO cult. Hopefully the whistle-blowers and the SEC will get to the bottom of this awful mess because our company is in a terrible state with disguised layoffs as PIPS, poor investment decisions, poor management, leveraged to the hilt, poor culture, senior management compensating themselves while taking away our benefits, etc. And I most certainly want it to change and become a great company to work for if that is even possible at this point, maybe exposing XTO is a start. God bless you All and have a Happy Easter.
SO becoming XTO president after doing a horrible job at URC (which over her and TS regime became one of the most terrible and incompetent organization) was a clear sign of doom for XTO.
Given the replies thus far to OP, $20B in write downs, drilling at a stand still, no Wink to Webster construction taking place, and they still defend and support this business. It is quite obvious that XTO employees are a cult unto to themselves and separate from the rest of us at ExxonMobil.
Some of the improper terminology used and general lack of understanding of the short cycle unconventional business model definitely casts doubt on the OP’s post. “Drilling units” is my favorite!
More lies from trolls.
The Wink-to-Webster pipeline system already has 100% of its contractable capacity secured under long-term commitments from shippers.
The Wink terminal will ensure market access to EM and other Permian producers, with EM in the driver's seat following this strategic acquisition. No, EM did not build the terminal.
In July 2020, EM announced it was cutting the Permian rig count from 50 in 2019 to 30 by summer, with another reduction of at least 50% by year-end, all part of capex reductions and reprioritizations due to the dramatic drop in crude price and demand. So, no surprise that EM is using the Permian to manage capex since it can meet all drilling commitments there with a delayed schedule. Not so everyplace else.
EM, along with other Permian operators, also reduced the crude production ramp-up schedule due to lower capex levels. No surprise.
Nothing of any significance will come of the SEC investigation. We know the credibility of whistleblowers.
Since you are so knowledgeable and tough, why don't you post these comments internally, or speak up employee forums? Maybe speak at the 2021 shareholders meeting? Oh wait, those might require facts. LOL