Friday, April 8, 2011

Exxon's (XOM) Tillerson Likes Future of Natural Gas

Exxon Mobil (NYSE:XOM) CEO and Chairman Rex Tillerson says that even though oil prices have been skyrocketing (CLCV1) 110.60, he still likes the acquisition of XTO Energy they made, even though it could pressure the company in the short term.

Tillerson sees natural gas demand growing by 60 percent by 2030.

Concerning XTO he says, "I think the timing was good from our perspective. The current conditions were not unexpected by us," adding Exxon is "happy in the resource we have and in the organization we acquired as well."

He's right. If Exxon had waited until the inevitable rise in natural gas prices, who knows what it would have had to have paid for XTO at that time. He bought it at the time when natural gas supply was high and prices were low. Even under those conditions it cost Exxon $30 billion for XTO.

Tillerson concluded, "It’s part of my responsibility that we’re giving good value to the shareholders. I think we have done everything that is appropriate to do in terms of making sure people understand the steps we’ve taken to position the company to deliver that kind of long-term shareholder value."

Exxon closed Thursday at $85.76, gaining $0.58, or 0.68 percent.

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