ExxonMobil is selling its Canadian shale gas business for roughly $1.5 billion, marking the oil giant’s exit from regions rich in natural gas but stunted by a lack of pipelines and other infrastructure, according to The Wall Street Journal.
The all-cash sale of XTO Energy Canada, jointly owned by ExxonMobil and subsidiary Imperial to Whitecap Resources Inc., is the industry’s latest move to consolidate oil-field investments in western Canada. ExxonMobil and its affiliates had more than 600,000 net acres in the region, and the sale is expected to close in the third quarter.
While several large oil companies have exited Canada’s oil sands due to economic and environmental challenges, Canada’s shale formations have attracted some big spenders in recent years, including ConocoPhillips and Chevron, that have sought to apply U.S.-style fracking there. Still, regulatory challenges to expanding pipeline capacity have weighed on drilling activity in the region. Read the full story.