Hearing rumors around EMHC. Upper level execs more unavailable than normal... anyone hearing anything?
12 replies (most recent on top)
Please merge and layoff the many layers of useless management that are not needed to support both organizations.
They have not mentioned the massive number of US properties that should be sold (most of GOM except Thunderhorse). Sell all of East Texas and South Texas. Sell Prudhoe Bay and SYU. Sell small fields in Canada has a number of properties to sell (Ho–n River, MacKenzie). Prudhoe sale can be deferred till 2026 or 27. Plenty of field sale work for next 5 years. All these field sales will gradually reduce headcount in engineering, geoscience, global services, IT, procurement and controllers by 5k. About 1k in Houston. If you stretch field sales out to 2028–29...I think the $50 G number is about right, but the big benefit is cutting alot of overhead, opex, pension liability, and abandonment costs. Lots of operating risk (spills, fires, emissions, accidents, catastrophe loss etc) of old properties is eliminated also.
Anyone hear of any changes to the Rail Planning & Ops group in Chemicals GSC?
Chemicals and F&L merging would be the smartest thing for Downstream careers in the last 20 years. The stupidity of siloing talent based on which company an employee randomly hired into is phenomenal. Even worse is the hours and hours of high–level managers horse–trading or pulling the ‘ownership’ trump card at the expense of employee development. I cannot even count the people who have been wronged (and know they have been wronged) in one way or another due to this invisible line.
For $1350 USD, Wood MacKenzie can provide their insights into what XOM needs to achieve compared to the other SuperMajors..
We think ExxonMobil has the potential to double its disposal target. A deep dive into the upstream portfolio reveals nearly US$50 billion of asset sales potential, spanning tail-end mature assets, non-core growth opportunities, lower-margin assets and needle-moving disposal wildcards.
What's inside this report?
ExxonMobil has fallen behind in the race to high-grade. Portfolio rationalisation is now a key focus and the Supermajor has announced plans to sell US$15 billion of assets out to 2021.
In this report, we take a closer look at ExxonMobil's disposal plans and ask:
(1) Is the disposal programme ambitious enough?
(2) Which assets will be put up for sale and at what price?
Why buy this report?
Get our take on the SuperMajor’s plans, including:
Why we think ExxonMobil could double its asset disposal target
(1) How ExxonMobil’s portfolio rationalisation activity compares to its peers
(2) Which assets will unlock the most value for the SuperMajor.
This report comes with datasets and charts, including this one, which demonstrates that ExxonMobil’s sales in upstream assets are well behind its peers.
https://www.woodmac.com/reports/upstream-oil-and-gas-exxonmobil-what-will-be-sold-308935
The pre-Covid plan as reported by Wall Street was to focus on megaprojects moving forward.
The key is to determine whether your business unit is considered a "megaproject" or a "niche" business unit.
EXCLUSIVE-Exxon aims to sell $25 billion of assets to focus on mega-projects - sources
Ron Bousso Reuters
Shadia Nasralla Reuters
PUBLISHED
November 2019
LONDON, Nov 21 (Reuters) - Exxon Mobil XOM.N plans to sell up to $25 billion of oil and gas fields in Europe, Asia and Africa in its biggest asset sales for decades, seeking to free up cash to focus on a handful of mega-projects, according to three banking sources.
The sell-off would be a marked acceleration of the U.S. oil major's previous divestment plans. It would represent an ambitious attempt by Chief Executive Darren Woods to catch up with competitors who carried out sweeping portfolio reviews and sold swathes of assets following the 2014 market crash.
Exxon's shares have underperformed its major rivals' in recent years. The disposals would help the company increase spending on new developments and appease investors unhappy with weak cash generation and oil output, which flatlined under Woods' predecessor Rex Tillerson.
The sales would see Exxon effectively quit its upstream oil and gas business in Europe, according to the three banking sources with direct knowledge of the plans. They would free up cash to invest in new developments in Guyana, Mozambique, Papua New Guinea, Brazil and the United States.
An Exxon spokesman declined to comment on specific assets offered for sale but noted it has told Wall Street its asset sales could reach $25 billion through 2025.
Shares in the world's top listed energy company rose following the Reuters report and were up 1.5% at 1816 GMT.
n recent months, the Texas-based company has drawn up an extensive list of assets that it wants to divest, spanning at least 11 countries, the sources said.
The list, details of which have not been previously reported, would easily exceed its current divestment target which envisages it selling about $15 billion of assets by 2021.
Exxon has struck a number of deals in recent months including a $4.5 billion exit from Norway, and is also already offering assets in Australia, Nigeria, Malaysia.
The expanded plan will see Exxon also sell out of operations in the British North Sea, Germany and Romania, according to the sources. In Europe, that would leave it with production only in the Netherlands, where it holds a stake with Royal Dutch Shell in the giant Groningen gas field which the government plans to shut down in 2022.
The new plan would also see Exxon significantly pare back operations in Southeast Asia with the sale of its assets in Indonesia and Malaysia, the sources said.
In Africa, Exxon wants to sell its operations in Chad, Equatorial Guinea as well as parts of its Nigerian assets.
While Exxon is set to ramp up its spending sharply in the coming years to develop new oil and gas projects, most of its peers have more cautious spending plans due to an uncertain outlook for oil prices and growing pressure from investors to diversify away from fossil fuels towards renewables.
For a factbox on the asset sales
INVESTOR PRESSURE
Exxon responded more slowly to the 2014 oil price crash than some of its rivals that sharply cut spending, putting it under pressure from shareholders to reduce costs.
Exxon's shares heavily underperformed relative to other Oil Majors over the past five years.
https://tmsnrt.rs/2LsEuoy
Unlike rivals such as Shell and BP, Exxon did not carry out major review of its portfolio in recent decades. BP sold over $65 billion of assets following the 2010 Deepwater Horizon spill in the Gulf of Mexico while Shell sold over $30 billion after acquiring rival BG Group in 2016.
Under Woods, Exxon is set to sharply increase its spending in the coming years as it launches new, large oil and gas developments. In its 2019 investor day, the company said it planned to boost its annual capital spending from $26 billion in 2018 to $30-$35 billion between 2021 and 2025.
Building up its coffers via asset sales could help allay concerns that Exxon will ramp up its debt levels to fund new projects, particularly with oil prices remaining stubbornly close to $60 a barrel.
Moody's Investor Service on Tuesday changed Exxon's outlook to negative from stable due to its negative free cash flow and anticipated use of debt to fund its future capital spending.
Moody's has forecast negative free cash flow of about $7 billion this year and $9 billion next year. It warned the company's debt rating could be lowered next year if Exxon's financial metrics weaken further.
By contrast, Exxon's biggest rival Shell has generated $21 billion in free cash flows so far this year and the figure is expected to rise further in the fourth quarter.
"The company's high level of growth capital investments cannot be funded with operating cash flow and asset sales at projected levels given ExxonMobil's substantial dividend payout, absent meaningfully higher commodity prices and earnings from downstream and chemicals," Moody's said.
Exxon share performancehttps://tmsnrt.rs/2LsEuoy
For a factbox on the asset sales ID:nL8N2814T6
Exxon vs. Shell cashflowhttps://tmsnrt.rs/2KJD7PH
(Additional reporting by Gary McWilliams and Jennifer Hiller in Houston; Editing by David Evans and Pravin Char)
((ron.bousso@thomsonreuters.com; +44 (0) 2075422161; Reuters Messaging: ron.bousso.reuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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https://www.nasdaq.com/articles/exclusive-exxon-aims-to-sell-%2425-billion-of-assets-to-focus-on-mega-projects-sources-2019
@gok+1atVCrX1 another Altona story playing out all over again. Who would have guessed, the best and the brightest calling the shots?
Chemicals is being sold off piecemeal. One business at a time. But the rumor is that fearless leader doesn’t like the offers he’s getting. Greedy to the end...
Chemicals here. Can’t help but think that is getting sold off would be better in the long run. I’d love to see us merge with DOW or CP Chem, although I doubt the SEC would allow it.
More titanic deck chair shuffling is good, peons.
I’ve heard the same rumor, but not a simple merger, plenty of reorgs built in
Don't be a feeder on rumors.
Chemicals is being sold off – by the end of 2022.
Merger would make it more complicated.
All good.