While Copenhagen Talks, Exxon Bets $41B

Daily Telegraph December 15, 2009

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By Damian Reece Published: 8:49PM GMT 14 Dec 2009

Comments 3 | Comment on this article

An area rich in gas shale in the US state of Colorado

What the world's energy giants do with their immense financial resources will be as important as what the world's politicians do.

Given the way Copenhagen is going, however, it will probably be what the politicians don't agree to do which will be the UN summit's legacy.

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Anyway, while they bicker, business acts and Rex Tillerson, Exxon's chairman and chief executive, has placed a big bet on the future of energy and has chosen gas, by buying XTO Energy. Not just any gas but gas that counts as "unconventional resources" which is pumped out of shale, so called "tight gas" out of rock and coal bed methane.

Gas is not carbon free, but it is low carbon so addresses lower emission requirements. It's abundant and with technological advances, such as those developed by XTO, more can be pumped from the free world rather than rely on the collection of autocracies and kleptocracies that currently exert such control over the stuff.

That is important because the huge cost, in both time and money, of developing alternatives such as nuclear and wind power mean gas is in huge demand so relying on less than friendly suppliers is a big risk, as vulnerable economies such as the UK recognise. More gas investment can be expected not just from Exxon but from BP and Shell too. However, large scale acquisitions fund

By Damian Reece Published: 8:49PM GMT 14 Dec 2009

Comments 3 | Comment on this article

What the world's energy giants do with their immense financial resources will be as important as what the world's politicians do.

Given the way Copenhagen is going, however, it will probably be what the politicians don't agree to do which will be the UN summit's legacy.

That said, Exxon's XTO deal helps maintain the momentum the mergers and acquisitions market has seen in recent months. As politicians dither and debate, the market has taken another decisive step in dictating where the world's energy dollars are invested, whether campaigners like it or not.

Comments: 3

'...more can be pumped from the free world rather than rely on the collection of autocracies and kleptocracies that currently exert such control over the stuff.' Interesting Newspeak that. Psychological projection conveniently hides the truth.

A tax on shipping is the most absurd one ever come up with. Shipping is the most efficient transporter.In comparison with Lorries, these should be far more highly taxed as to the hurrendous damage to the roads they as to the ridiculous numbers of 32/28 tonners running about.

'...more can be pumped from the free world rather than rely on the collection of autocracies and kleptocracies that currently exert such control over the stuff.' A year or two back one could have read this without pausing. Good thing that shale gas is cheap. So we can all just head off with our picks and shovels and stick some in a can or something. We'll work it out. You see, they've killed the goose that laid the golden egg. The worker, who was also the consumer I mean. So long. Ta.