What assets Exxon Mobil plans to sell
American oil corporation Exxon Mobil, which is one of the largest in the world, has decided to sell a number of assets in Europe, Africa and Asia. In total, the management plans to receive $25 billion from the deal. The purpose of such actions was the new strategy of the company, which implies that the company will direct its efforts and funds to the implementation of major projects in the domestic and foreign markets.
Some time ago Exxon faced difficulties on the part of investors. They insisted on releasing and redistributing funds. The company, in turn, wanted to increase funding for the US, Guyana, Papua New Guinea and Mozambique.
The list of projects for sale includes fields in 11 countries. No official statement from Exxon Mobil has been received yet, so there is no complete information about the company’s plans and the projects to be opened for purchase.
This is not the first sale of the oil giant’s assets. Within a few months, the company disposed of a number of its assets, including fields in Norway, for which it received $4.5 billion. In the future Exxon intends to sell its projects in Malaysia, Australia and Nigeria.
According to the new strategy, the corporation will complete oil and gas production in Europe. The fields are located in the UK, Romania and Germany. The existing assets will be sold in the near future.
Until 2022, the company will continue production at facilities in the Netherlands, in the large Groningen field, which is owned jointly with Royal Dutch Shell Corporation. After this year, the project will be closed.
The assets in Asia will be significantly reduced, Exxon plans to abandon mining in Equatorial Guinea, Chad, and also to sell several fields in Nigeria.
The oil corporation arose from the merger of Exxon and Mobil in 1999. Both firms were heirs to Standard Oil, which was founded by John Rockefeller in 1870.
For a long time two corporations were actively evolving, developing and selling their products, but the Asian financial crisis, which occurred in 1997, forced to reconsider further business plans. The sharp decline in demand for oil led to a reduction in the price of raw materials to $11 per barrel, which was a historic low. Therefore, the companies decided to merge in order to maintain their market position and become the largest producer and supplier of raw materials.
The deal to form the new ExxonMobil Corporation amounted to $73.7 billion. In addition, this step made it possible to reduce costs by $2.8 billion annually for each of the parties.