Energy
Thursday, December 7th, 2023 4:22 pm EDT
Key Points
- Exxon CEO Dismisses Concerns Over FTC Scrutiny: Exxon Mobil CEO Darren Woods has dismissed concerns about potential obstacles to the company’s $60 billion acquisition of Pioneer Natural Resources. In an exclusive interview with CNBC, Woods expressed confidence that there are no competition concerns that could impede the deal, emphasizing its relatively small scale in the broader U.S. oil market. The deal, expected to close in the first half of 2024, is Exxon’s largest since the $75 billion merger with Mobil in 1999.
- FTC Probe and Senate Scrutiny: The Federal Trade Commission (FTC) has sought additional information from Exxon regarding the acquisition, leading to a response from Woods, who stated that the company will promptly address the regulatory inquiries. Senate Majority Leader Chuck Schumer and over 20 Democratic colleagues have called on the FTC to scrutinize Exxon’s acquisition, along with Chevron’s $53 billion deal to buy Hess. The senators argue that these deals may lead to higher gas prices for Americans and exhibit signs of harmful, anticompetitive effects.
- Geopolitical Factors and Investment Focus: Exxon is heavily investing in oil production in the Permian Basin and the South American nation of Guyana. However, geopolitical uncertainties arise from a border dispute between neighboring Venezuela and Guyana, with Venezuela voting to claim sovereignty over a portion of Guyana’s territory. Woods anticipates the dispute being resolved in the International Court of Justice and believes that Guyana would not stand alone if faced with the threat of invasion. The CEO emphasized Exxon’s commitment to responsibly developing resources in Guyana and fulfilling contractual obligations economically and environmentally.
Exxon Mobil CEO Darren Woods addressed concerns about potential obstacles to the oil giant’s acquisition of Pioneer Natural Resources, dismissing worries about competition issues with the Federal Trade Commission (FTC). In an exclusive interview with CNBC’s “Squawk on the Street,” Woods expressed confidence that there are no competition concerns with the $60 billion deal, emphasizing its relatively small scale within the broader U.S. oil market. He stated that the oil production resulting from the acquisition of Pioneer would represent less than 5% of the total U.S. output.
The pending acquisition of Pioneer is Exxon’s largest deal since its $75 billion merger with Mobil in 1999, positioning Pioneer as a significant player in the oil-rich Permian Basin. Despite the FTC seeking additional information on the acquisition, Woods assured a swift response, indicating the company’s willingness to cooperate with the probe.
Senate Majority Leader Chuck Schumer and more than 20 Democratic colleagues urged the FTC to scrutinize both Exxon’s acquisition of Pioneer and Chevron’s $53 billion deal to buy Hess, expressing concerns that these transactions could lead to higher gas prices for Americans. The senators contended that the deals exhibited signs of harmful, anticompetitive effects.
Exxon has been strategically investing in production in the Permian Basin and Guyana. However, a border dispute between neighboring Venezuela and Guyana, coupled with concerns about potential sovereignty challenges, has raised geopolitical uncertainties. Woods acknowledged the longstanding border issue and expressed optimism that the dispute would be resolved through the International Court of Justice.
Addressing fears of a potential invasion by Venezuela, Woods expressed confidence that Guyana would not stand alone in such a scenario. He highlighted the international community’s likely broad support in ensuring that the right processes are followed to resolve the territorial dispute. Woods emphasized Exxon’s commitment to responsibly developing resources in Guyana, adhering to contractual obligations in both economic and environmental aspects.
For the full original article on CNBC, please click here: https://www.cnbc.com/2023/12/07/exxon-ceo-dismisses-worries-ftc-could-hold-up-pioneer-deal-does-not-see-competition-concerns.html
