ExxonMobil (XOM) Signs a 20-year Agreement for LNG Purchase
Exxon Mobil Corporation XOM, the U.S.-based energy giant, signed an agreement to purchase an additional 1.2 million metric tons per year (MMtpa) of Liquefied Natural Gas (LNG) from Mexico Pacific on a free-on-board basis.
This 20-year supply deal with ExxonMobil paves the way for Mexico Pacific to reach a final investment decision to expand its Saguaro Energia LNG Plant, situated on the west coast of Mexico.
Mexico Pacific stated that, with this deal, it has finalized the necessary sales needed to make a final investment decision on Train 3 of the Saguaro Energia project, expected later in 2024.
The deal follows the exercise of options by ExxonMobil for additional volumes under separate sales and purchase agreements signed in January 2023. Per the terms of the aforementioned agreement, ExxonMobil purchased 2 million tons per year of LNG from Saguaro Energia’s first two LNG Trains. The Saguaro Energia project, worth $15 billion, has been planned to transport 15 MMtpa of LNG to Asia.
Zacks Rank and Key Picks
Currently, XOM carries a Zacks Rank #3 (Hold).
Investors might want to look at some better-ranked stocks in the energy sector, such as Oceaneering International OII, Vaalco Energy (EGY) and Cheniere Energy LNG. While Oceaneering International and Vaalco Energy currently sport a Zacks Rank #1 (Strong Buy) each, Cheniere holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Oceaneering International is a market-leading supplier of offshore equipment and technology solutions to the energy industry. The company has projected an increase in free cash flows for 2024. The bright outlook is supported by the growing market demand for its mobile robotic forklifts and underride vehicles.
Vaalco Energy is an independent energy company involved in upstream operation business with a diversified presence in Africa and Canada. The company’s production outlook appears bright, attributed to its large inventory of drilling locations in premium Canadian Acreage.
Cheniere Energy is a U.S.-based company, focused on LNG export. The company has a positive outlook, considering the global trend to shift toward cleaner energy solutions for power generation and increased demand for LNG, especially in the Asia-Pacific region.
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Exxon Mobil Corporation (XOM) : Free Stock Analysis Report
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