Exxon Mobil Corp has reached an agreement with Flywheel Energy to sell to the closely held US oil and gas producer natural gas properties in Arkansas, an Exxon spokesperson confirmed on Friday.
The sale of Exxon’s Fayetteville Shale assets brings the largest US producer closer to a goal of selling $15 billion in non-core properties to focus on more lucrative prospects. The value of the proposed deal could not be immediately learned.
US gas prices and properties have grown in demand this year with global demand for the fuel soaring over the conflict in Ukraine. US gas futures on Friday settled at about $9.30 a million British thermal units, up 160% year to date.
“The sale advances Exxon Mobil’s strategy to focus investments on advantaged assets,” Exxon spokesperson Julie King told Reuters.
Flywheel Energy did not immediately reply to requests for comment on the agreement signed with XTO Energy, a subsidiary of Exxon. Flywheel is headquartered in Oklahoma City and is backed by Kayne Anderson Private Energy Income Funds.
The assets under agreement include approximately 5,000 natural gas wells - 850 operated and approximately 4,100 non-operated - and related pipeline and processing properties across approximately 381,000 acres.
Exxon’s XTO Energy unit had acquired the Fayetteville assets in 2010 for $650 million during a shale boom that reshaped the US energy landscape. King declined to comment on pricing, saying the terms of the transaction are confidential.
The sale is subject to regulatory and other approvals. It is expected to close before the end of October, King said.
The oil giant disclosed plans to offer its Fayetteville and other US shale assets outside of the Permian Basin in 2020. Last year it actively resumed its divestment program as energy prices recovered from the pandemic-induced slump.
Exxon has been dumping projects in Asia, Africa and Europe for offshore Guyana and Brazil and shale oil in the Permian Basin of West Texas and New Mexico.
Earlier this year, it sold North Texas shale assets to Denver-based BKV, a gas producer majority-owned by Thai energy firm Banpu PCL, for $750 million.—Reuters
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