EXXONMOBIL PUTS $41 BILLION INTO FUTURE OF NATURAL GAS

ExxonMobil’s plan to put $41 billion into the purchase XTO Energy Inc. has Louisiana oil and gas officials riding a natural gas high. “Exxon’s purchase of XTO is yet another example of how important a role natural gas is going to play in the future of our country,” says Gifford Briggs, vice president of the Louisiana Oil and Gas Association, which has spent the past year touting clean-burning natural gas as a bridge fuel for the 21st century energy economy.

“As Shell, BP and Exxon become more involved in shale plays and the development of natural gas, it should be a sign to all of us that a shift in America’s energy focus has begun,” Briggs adds, noting that the deal also speaks volumes about the importance of north Louisiana’s Haynesville Shale to the U.S. energy market. “In the Haynesville Shale Exxon now has a foothold in the largest natural gas play in the country.”
The all-stock transaction announced yesterday will enhance ExxonMobil’s position in the development of unconventional natural gas and oil resources.

ExxonMobil has agreed to issue 0.7098 common shares for each common share of XTO, which represents a 25 percent premium to XTO stockholders. The transaction value includes $10 billion of existing XTO debt and is based on the closing share prices of ExxonMobil and XTO on Dec. 11. The acquisition catapults ExxonMobil, the largest publicly traded energy company, to the number one U.S. gas producer.
“XTO’s strengths, together with ExxonMobil’s advanced R&D and operational capabilities, global scale and financial capacity, should enable development of additional supplies of unconventional oil and gas resources, benefiting consumers both here in the United States and around the world,” said Rex W. Tillerson, chairman and CEO of Exxon Mobil Corporation, in announcing the deal. Tillerson also called the agreement good news for the U.S. economy and energy security, as it will enhance opportunities for job creation and investment in the production of America’s own clean-burning natural gas resources.

XTO’s resource base is the equivalent of 45 trillion cubic feet of gas and includes shale gas, tight gas, coal bed methane and shale oil. These will complement ExxonMobil’s holdings in the United States, Canada, Germany, Poland, Hungary and Argentina.

Once the transaction closes — it is subject to XTO stockholder approval and regulatory clearance — ExxonMobil will establish a new upstream organization to manage global development and production of unconventional resources. The new organization will be located in Fort Worth, in XTO’s current offices.

“XTO has a proven ability to profitably and consistently grow production and reserves in unconventional resources,” said Bob R. Simpson, chairman and founder of XTO. “As the world’s leading energy company, ExxonMobil will build on our success and open new opportunities for the development of natural gas and oil resources on a global basis.”

For analysts and other industry observers, though, the question now is whether the conservative ExxonMobil organization can integrate XTO without quelling its aggressive spirit — the kind of entrepreneurial risk-taking that built XTO into the country’s top gas producer. It certainly didn’t buy these assets to put them on a shelf, but will Exxon let XTO be XTO?

WINE SHOP EDUCATES SHOPPERS ON PAIRING

Ambassador Wine and Spirits, located at the corner of Ambassador Caffery Parkway and Dulles Drive, caters to Lafayette’s sophisticated wine drinker as well as the novice, featuring a touch-screen kiosk that educates customers on which wines to pair with different foods. General Manager Steve Sammons and his assistant, Lee Drennan, have more than 40 years of combined experience in the wine and spirits industry. “Lafayette has its fair share of people who are very knowledgeable about wines and other spirits,” says Sammons. “This store is tailored to their sophisticated tastes. At the same time, we want to appeal to those who might need advice selecting the right wine for the right meal.”

The store features an expansive collection of fine wines, liquor, domestic and imported beer and premium cigars.

MCDONALD’S OF ACADIANA BRINGS BACK FREE WIFI

E.J. Krampe thought his customers deserved a break. And like a lot of other McDonald’s franchisees, he’s been lobbying for that break — free WiFi in his 20 stores — for the past two years. The Krampe family actually began offering the service free in early 2005, but McDonald’s corporate came in with a new system in 2007 that required customers to pay. “It just didn’t make sense; there’s no reason it can’t be free,” Krampe says. “[So] the operators complained.” And they’ll get their wish beginning Jan. 15 when McDonald’s, hoping to take a bigger bite out of the coffeehouse business than its McCafé’s have already done, launches free WiFi nationwide.

“In January we’ve got a lot of things going on,” Krampe adds. On Jan. 1 McDonald’s of Acadiana will debut its new $1 breakfast menu, and the local operators have already rolled out frappes — frozen coffee drinks in caramel and mocha flavor — at their newly constructed Kaliste Saloom Road store. By the end of January frappes will be sold at all Acadiana locations of McDonald’s.

And there’s more to come: This summer fresh-fruit based smoothies will appear on the menu. “Then we’ll pretty much have our whole beverage strategy laid out,” Krampe says.

Compiled and edited by Leslie Turk; e-mail her at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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