Dec. 23 (Bloomberg) — Exxon Mobil Corp agreed to pay $650 million for Petrohawk Energy Corp.’s natural-gas wells and pipelines in the Fayetteville Shale, its second shale purchase this year.
The Arkansas assets produce about 98 million cubic feet of gas a day, Houston-based Petrohawk said today in a statement. The sale of the wells, valued at $575 million, is complete and has an Oct. 1 effective date, according to the statement.
Exxon also agreed to buy pipelines that collect gas from Fayetteville Shale wells for $75 million. That sale is subject to regulatory approval and expected to close early next year, Petrohawk said.
Exxon Mobil, based in Irving, Texas, in June bought XTO Energy for $35 billion including debt to add expertise and holdings in shale deposits, where new technology has reversed a decline in U.S. gas production and swelled reserves.
“The logic behind the purchase of XTO and the purchase of this acreage is very much in parallel,” said Pavel Molchanov, a Houston-based analyst for Raymond James & Associates Inc. who rates Exxon’s shares at “market perform” and owns none. “This represents an increase of about 40 percent in acreage they own in the Fayetteville Shale.”
Exxon is paying Petrohawk about $1.92 for each thousand cubic feet of estimated proved reserves, around 36 percent less than it paid for XTO, Molchanov said. That’s to be expected because gas prices have fallen 21 percent since the XTO purchase was announced more than a year ago, he said. This transaction is also smaller and more focused, Molchanov said.