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Exxon Starts U.S Shale Gas Properties Sale To Reduce Debt

Oil company Exxon Mobil Corp. (XOM) on Tuesday started the sale of its U.S shale gas properties even as the company resurrects a long- delayed program to raise money with the aim of reducing debt and selling of unwanted assets.

Exxon Mobil spokesperson Julie King said, "The company's XTO Energy shale unit is seeking buyers for almost 5,000 natural gas wells in the Fayetteville Shale in Arkansas."

King commented, "We are providing information to third parties that may have an interest in the assets. The spokesperson added that no buyers have been identified till now.

According to reports, the company is advertising the properties itself and expects to receive purchase bids from August onwards.

Exxon said that the Arkansas properties is spread over 416,000 net acres and have some of North American natural gas resources, which were cut off from the company's development plan last year. It is said that the Arkansas area includes 844 operated and 4,104 non-operated wells.

Exxon bought Fayetteville assets in 2010 for a sum of $650 million during the shale boom, which brought about changes in the U.S. energy sector. The boom then led to an oversupply of gas that brought prices to historic lows and in 2020, the company had to reduce the value of its U.S. oil and gas holdings by $17.1 billion.

In 2018, Exxon had set a goal to raise $15 billion from sales by December and more recently, it announced plans to improve poor sales to reduce a record $70 billion debt.

The company reached a third of its three-year, $15 billion target even though activity and asset values were down during the COVID-19 pandemic. Exxon recorded sales of $557 million in June and has pending deals worth more than $2.15 billion.

The company recorded a $22.4 billion loss last year and thus plans to sell off properties in Asia, Africa, U.S and Europe to overcome the losses. After total debt last year touched $70 billion since 2018, the company paid off more than $7 billion in fiscal 2021, to reduce the burden to $60.6 billion.

This year, the company is holding talks with Savannah Energy over the sale of Chad and Cameron properties and it has already sold shares in two deep water oilfields to Occidental Petroleum.

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