Spanish oil giant Repsol SA is in advanced talks to acquire some deepwater assets in the U.S. Gulf of Mexico from Exxon Mobil Corp for about $1 billion, three people familiar with the matter said on Monday.
The deal would be a boon to Exxon’s plans to accelerate asset sales, as it seeks to raise cash to return to shareholders and fund major projects. Suppressed oil prices have weighed on the appetite of oil majors to buy such assets.
There is no certainty a deal will be agreed, the sources said. The transaction would require approval from partners in the assets, who may have preferential rights to buy them, said two of the sources.
The sources asked not to be identified because the matter is confidential. Representatives for Exxon and Repsol declined to comment.
Exxon began the process to jettison Gulf of Mexico assets last year with advice from JPMorgan Chase & Co,.
Fall/Winter 2018, Exxon was marketing nine assets. These included its 50% stake in the large Julia oil field, which it operates, as well a 9.4% piece of the Heidelberg field and 23% of the Lucius oil and gas field, both of which are now operated by Occidental Petroleum Corp.
The exact number of assets that Exxon would sell to Repsol could not be learned.
The Irving, Texas-based company is trimming its portfolio to focus on promising acreage in offshore areas such as Guyana and Brazil, and onshore in the Permian Basin of Texas and New Mexico. This includes in the Gulf of Mexico, once considered a reliable basin for oil exploration and production.
Exxon’s Chief Executive Darren Woods said earlier this year the company was targeting $15 billion through 2021 from asset sales, although securing divestments has been difficult at a time when many oil developers, especially in the United States, are eschewing purchases to focus on existing portfolios.
However, the world’s largest publicly traded energy company said last week it was in exclusive talks with Var Energi in relation to Exxon’s Norwegian upstream assets, the duo were close to a $4 billion deal.