Insight
ExxonMobil’s Permian synergies: defining the value in data strategy
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*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
Competitors crave a better understanding of ExxonMobil’s bold US$2 billion annual synergy targets for Pioneer's assets. We think the goal is realistic; capturing just half of the synergy value would cover the deal premium. The balance would be pure value upside. We see demonstrable value opportunities by eliminating excess capital from well completions. If successful, NPV10 per well would increase roughly US$1 million and breakevens would reach ExxonMobil's target of US$35/bbl. Resource capture synergies will take longer to develop. Expensive data collection and advanced AI/ML modeling to reach these new benchmarks is ExxonMobil's tool. Investment in these resources has been stymied through the Independents’ era of cost control. Scale changes this, and ExxonMobil’s pro-forma portfolio puts it in the driver’s seat.
Table of contents
- Executive summary
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Clarifying the synergy targets
- Defining synergies
- History rhymes: adapting the original plan
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Updated Permian plan: unique data investments and capabilities
- 1. Diagnostics – cataloguing old data and generating new data at scale
- 3. Agility – complex decisions at speed
- Note parallels to conventional exploration data management
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Putting the model to work
- Critical cost reductions
- Destinations not desires
- Going forward
- Appendix A: Industry feedback on ExxonMobil’s plan
Tables and charts
This report includes the following images and tables:
- ExxonMobil 2022-2023 Midland multi-zone performance
- XOM global upstream portfolio value and synergy breakdown (US$ billion)
- Appendix B: ExxonMobil’s Midland Basin plan
- ExxonMobil 2019 Delaware plan
- ExxonMobil sample cube 2019 Delaware cube (Remuda South 25)
- All neighboring Delaware operators – same reservoirs (2019 wells)
- Sample of Pioneer trial technology - 2018
- Breakeven reduction vs. ExxonMobil target
- Value sensitivity: lower completion capex
What's included
This report contains:
