Top U.S. oil producer Exxon Mobil Corp plans to sell a portion of its assets in North Dakota’s Bakken shale formation, the company told Reuters on Tuesday.
Following a wave of megamergers in U.S. shale patches, oil producers are reviewing their portfolios to decide which assets remain core to their strategy and which to divest.
“ExxonMobil is exploring market interest for select assets in the Bakken Shale Play, which includes approximately 137 operated wells and 676 non-operated and royalty wells across 49,000 net acres in North Dakota”, a company spokesperson said in response to Reuters questions.
The planned sale could fetch upwards of $500 million, two sources briefed on it told Reuters. They said it was part of Exxon’s efforts to focus on assets with the highest growth potential after a $60 billion takeover of rival Pioneer Natural Resources in May.
The sources requested anonymity as they are not authorized to speak publicly.
The decision aligns with a company strategy to continually evaluate its portfolio, Exxon said. The company declined to comment on the valuation, noting it is a corporate practice not to share such information.
A large portion of the land on sale is undeveloped, the sources said, which could make it attractive to potential buyers, both as it bolsters their land banks at a time when increased scale is important, but also as they may be able to boost output through future drilling.
Exxon is one of the top producers in the Bakken, the third largest oil-producing region in the U.S., with the company’s total production from the region at over 100,000 boepd, according to energy data provider Rextag.
Exxon said it will continue to invest in shale production in North Dakota as part of its long-term strategy.
This year, Exxon launched an auction to sell conventional drilling assets in the Permian basin, Reuters reported in June.
(Reporting by Shariq Khan in New York; Editing by David Gregorio)