Last year ExxonMobil (XOM) produced about 4.2 million barrels of oil/day. Is that enough ? Probably not. To add to their existing production volume, ExxonMobil has decided to invest in more than 20 new projects around the world over the next 3 years. This would bring in an additional 1 million barrels of oil/day to its volumes at peak production.
So where does Exxon plan to invest ?
Exxon has an ownership interest in 40 refineries located in 20 countries. 20 new projects the company plans to invest in will be mature markets such as North America, Australia and the North Sea, as well as growth areas like the Middle East, Russia and West Africa.
Exxon has decided to turn over the control of a joint project in Venezuela’s oil-rich Orinoco River region to its partner, Petroleos de Venezuela SA, Venezuela’s government-controlled oil company, now that President Hugo Chavez has ordered the nationalization of all foreign-run oil projects. Exxon is also in talks with Libya to get access to the country’s enormous oil fields.
In another news ExxonMobil and Qatar Petroleum announced they were abandoning their joint gas-to-liquids project that sought to produce clean diesel from natural gas, instead focusing on providing natural gas to Qatar.
Recently Exxon posted the largest annual profit by a U.S. company of $39.5 billion thanks to high energy prices as crude oil topped $78 a barrel in the summer. Stock prices stand at $71.12. The shares have traded in a range of $56.64 to $79 in the past year. However what bothers me is the capital spending.
Rants: Is Exxon a greedy corporation ? I mean they posted the largest annual profit, even though oil prices were down in the 4th quarter. It seems like Exxon would rather squeeze the consumers than take a hit themselves. Is Exxon for you ? With that kind of profit margins the answer is evident. Corporations like Exxon is going to make money year after year, doesnt matter what the oil prices are. Their 30 year chart will support my statement. The best thing to do would be to own Exxon stocks and make some money on their greed. Also the capital spending of $20 billion for the returns is simply outrageous. Is this some early warning for oil depletion ?
Stocks/ETFs to watch: ExxonMobil Corp. (XOM). Competitors: ConocoPhillips (COP), BP plc (BP), Chevron Corp. (CVX), Royal Dutch Shell (RDS.A), Total (TOT). ETFs: SPDR Oil & Gas Exploration & Production ETF (XOP), iShares Dow Jones U.S. Oil & Gas Exploration/Production (IEO) (Source: Seeking Alpha)
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