Exxon goes big on U.S. drilling
Exxon Mobil Corp. is making its closely watched analyst presentation today, and it underscores how the global oil giant is bullish on U.S. drilling projects. Exxon's plan to boost capital spending by $3 billion to $22 billion this year includes a big chunk of cash devoted to shale oil projects—the stuff tapped by fracking—in Texas, New Mexico and North Dakota.
Why it matters: Exxon's plan signals that the country's most powerful oil company is confident about making money from U.S. oilfields even as prices remain modest. "These resources are robust at lower prices," new CEO Darren Woods said in his presentation Wednesday.
The background: Exxon has been spending aggressively to expand its footprint in the Permian region that straddles Texas and New Mexico. Exxon said it has more than 5,500 wells in the Permian and North Dakota's Bakken region that provide better than 10 percent returns even if oil prices are as low as $40 per barrel, with nearly one-third offering "significantly higher" profits. Prices are currently trading at roughly $54 per barrel.