Exxon Mobil makes $29B bet on natural gas

[John Mitton]

http://www.npr.org/templates/story/story.php?storyId=121433406

Exxon Mobil, the world's largest publicly traded oil company, is making a $29 billion bet that pressure to curb climate change will mean natural gas -- cleaner than coal and suddenly much easier to reach -- will become a crucial source of U.S. power.

Exxon agreed to buy XTO Energy in an all-stock deal at a 25 percent premium, showing how eagerly a company that is among the most conservative in a conservative industry is jumping into the market for natural gas.

[cngacrossusa]

Re: Exxon Mobil makes $29B bet on natural gas

Yep, and we should be AFRAID . . . be very AFRAID . . . truth is monster company like Exxon wouldn't want more natural gas involvement unless they felt they could MANIPULATE the market (ie pricing / supply / distribution / etc) to benefit themselves. Also read in stock news that Exxon buying back their own shares is massive amounts, so soon transparency to what they are doing will be lost when they ultimately become private company.

Same can be said about Exxon advertising that they are investing in Battery Technology . . . wow, that's the LAST THING the world needs is Exxon meddling in future success of battery powered vehicles.

I say pour all our efforts to new start-up companies like electric car company reviving closed GM factory to produce Fisker all electric car . . . yep, "overnight" will be producing over 100,000 electric cars annually that GM and other big auto makers said "couldn't be done" . . . yeah, right ??!!##!! See the Karma as it's a beautiful car that will put the Volt to shame.

[tomdotstar]

Re: Exxon Mobil makes $29B bet on natural gas

I welcome Exxon's increased involvement. If Exxon has huge new US based NG volumes, they will need to sell that gas to someone in the US. Admittedly, power generation (lower carbon emissions than coal) and industrial uses will soak up the majority of gas. But remember, Exxon has the one thing the NGV industry needs.

What is the one thing we need? GAS STATIONS!

There is plenty of NG. It's cheap. There are millions of OEM NG vehicles around the world. In addition, there are numerous conversions available. And, unlike ethanol, solar, wind, etc, the economics work without any subsidies.

What's the first question someone asks when they see your CNG vehicle? "Where do you get your fuel?" I can't get my friends, neighbors, business associates or relatives to go to CNG because it's just too inconvenient.

Hybrids and electrics will probably win the race for very small cars. But larger cars, vans, delivery trucks (see the ATT deal) and 18-wheelers are perfect candidates for CNG.

Imagine what the CNG world would look like if only 5% of Exxon's stations offered CNG. Now that's a game changer.

[cngmike]

Re: Exxon Mobil makes $29B bet on natural gas

Welcome one and all to the marketing of CNG for on road use. If oil producers don't put the natural gas into the pipe lines it just get flared off. About 1/4 of the natural gas in Long Beach comes from local producers.

Over the years I have been contacted by producers of stranded wells that are trying to find ways to capture and sell their gas. The number one question is how to deal with the Hydrogen Sulfide.

[Gerben]

Re: Exxon Mobil makes $29B bet on natural gas

The number one question is how to deal with the Hydrogen Sulfide.

There are plenty of filters for that on the market. The cost are low compared to the rest of the processing cost (drying, compression, storage/transport).

[Gerben]

Re: Exxon Mobil makes $29B bet on natural gas

Imagine what the CNG world would look like if only 5% of Exxon's stations offered CNG. Now that's a game changer.

I very much doubt that Exxon would start offering CNG just because they bought a NG company. Shell produces more gas than oil, but they are slow to offer CNG in Europe. CNG is a direct competitor of other products, including GtL, which seems to be an important focuss for Shell. They rather convert the gas and sell it for a higher price.

[Curtis]

Re: Exxon Mobil makes $29B bet on natural gas

I will add a small clarification for those members that aren't clear about your GtL reference.
GtL, or Gas to Liquids tecnology: Gas to liquids is a refinery process to convert natural gas or other gaseous hydrocarbons into longer-chain hydrocarbons such as gasoline or diesel fuel. Methane-rich gases are converted into liquid fuels either via direct conversion or via syngas as an intermediate, for example using the Fischer Tropsch or Mobil processes.
Read more here...

[cngacrossusa]

Re: Exxon Mobil makes $29B bet on natural gas

I think Gerben is right that Exxon could care less about CNG. This purchase has all to do with other uses of NG . . . and little if any about CNG.

Case-in-point re: Exxon in USA - - could NOT find a single Exxon station in entire USA using the DOE's Alternative Fuels Data Center website with either a private or public cng site associated with Exxon. Only thing out there Exxon branded on the DOE site are E85 stations (yep ethanol) in SC, GA and VA ; Bio-Diesel in VA & TX ; Propane in various states, and LOTS of old fashioned petrol.

I'd turn sommer-sault flips with joy if Exxon were to announce any kind of public cng roll-out of pumps (even if they only were for over-the-road truckers with just LNG). I just don't see any potential of public cng coming from Exxon. They likely have higher profit potential ideas for NG that don't involve selling to the public!! Thus, this NG purchase is like a "land grab" in early settler days.