ExxonMobil signed a non-monetary exchange agreement Friday with Houston-based LINN Energy to swap 17,000 net acres in the Permian Basin for an operating interest in a southern California oil field.
LINN will receive ExxonMobil’s interest in the Hill property located in the South Belridge field near Bakersfield, California.
Hill is currently producing 3,400 barrels of oil equivalent per day, with oil making up approximately 100 percent of output.
LINN estimates total resource potential for Hill at 67 million barrels of oil equivalent, with oil accounting for approximately 100 percent of estimated resources.
Reserve life is projected to be about 22 years.
LINN said its currently planing more than 300 future drilling projects at the site.
In exchange for Hill, ExxonMobil will receive 17,000 net prospective acres for horizontal Wolfcamp drilling in the Midland Basin core area in west Texas.
Current production rate in the asset is approximately 4,700 barrels of oil equivalent per day.
Proved reserves are estimated at 19 million barrels of oil equivalent.
Additionally, ExxonMobil will receive 800 acres in the New Mexico Delaware Basin.
Both acreage positions will be operated and developed by ExxonMobil’s subsidiary XTO Energy.
This agreement extends XTO’s leasehold position across the entire Permian Basin to more than 1.5 million acres and net oil-equivalent production to more than 95,000 barrels per day.