Exxon to Spend $100 Million a Day to Boost Crude Production
Exxon has budgeted $34 billion for capital projects this year, a 5.6 percent increase from 2010, Chief Executive Officer Rex Tillerson said today at an analyst meeting in New York. The budget will range from $33 billion to $37 billion through 2015, according to a slide presentation prepared for the meeting.
Exxon expects to boost oil and gas production by 3 percent to 4 percent this year, the company said. Eleven new projects are scheduled to begin pumping oil or gas between now and 2013.
Exxon is spending more as the company expands its search for untapped oil and gas fields, and upgrades refining and chemical plants in Asia to supply the world’s fastest-growing energy markets. Production rose 13 percent last year, the largest annual increase since Exxon’s 1999 acquisition of Mobil Corp. Oil prices reached a 29-month high this week amid unrest in the Middle East.
“We are executing a large inventory of high-quality projects,” Tillerson said today. “Actual spending in a given year will vary depending on the pace and the progress of each project.”
Outpacing Mexico’s Reserves
The company replaced 209 percent of the oil and gas pumped from its wells last year, partly through the $34.9 billion acquisition of Fort Worth, Texas-based XTO Energy Inc. Exxon had proved reserves equivalent to 24.8 billion barrels at the end of December, which exceeded the crude reserves of nations such as Mexico or Algeria.
Exxon shares fell 84 cents to $83.76 at 9:57 a.m. in composite trading on the New York Stock Exchange.
Exxon, which traces its roots to the 1880s and John D. Rockefeller’s Standard Oil Trust, earned $15.50 in profit on each barrel of crude it produced in 2010, Tillerson said today in remarks to a gathering of analysts at the New York Stock Exchange.
Exxon is awaiting U.S. regulatory approval to drill two wells at its deep-water Hadrian discovery in the Gulf of Mexico, the company said. Work on Hadrian was interrupted after the fatal explosion at BP Plc’s Macondo well in April prompted the government to halt all exploration drilling in waters deeper than 500 feet (152 meters).
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