Exxon Mobil doubles down on fossil fuels with £50bn takeover

Exxon Mobil is in talks to buy a major US rival for £50bn as it doubles down on fossil fuels.

In a move likely to raise eyebrows among the green lobby, the American multinational oil giant is closing in on a takeover of Pioneer Natural Resources.

The acquisition would be Exxon’s biggest since it bought Mobil for £66billion in 1998 and would expand its footprint in one of the most lucrative regions of the US oil patch. 

Pioneer is the third-largest producer of oil in the Permian basin after Chevron and ConocoPhillips.

The basin, which stretches across parts of Texas and New Mexico, is the US energy industry’s most coveted because of its relatively low cost to extract oil and gas.

If the negotiations are successful, a deal between Exxon and Pioneer could be reached in the coming days, according to Reuters. Spokesmen for Exxon and Pioneer declined to comment.

Exxon is the largest US oil producer with an average 3.8m barrels per day from its global operations. Last year profits hit a record £45billion thanks to high oil and gas prices. 

Acquiring Pioneer would give Exxon more established oil-producing land that it can rely on to increase production when needed, rather than risk its cash on the development of unproven acreage.

Any deal is set to attract political and regulatory scrutiny.

The White House accused Exxon in February of achieving bumper profits at the expense of consumers.