Big Oil Continues to Move Into Natural Gas

Last month Exxon bought XTO, a large player in the "unconventional" natural gas field. Yesterday's announcement that Total was investing in a portion of Chesapeake's shale gas fields continues the trend of the large integrated oil producers towards natural gas.

The advantages of natural gas - clean burning, large US availability - have significant appeal to the large integrated oil companies that have struggled with replacing reserves.

Total in $2.25bn gas deal with Chesapeake

Posted by Gwen Robinson on Jan 05 05:06.

Total on Monday became the third big European energy company to buy into Chesapeake Energy’s US shale gas assets. The French oil producer will pay up to $2.25bn for 25% of Chesapeake’s assets in Texas Barnett Shale, $800m of it in cash and the rest by funding 60% of the project’s costs over the next 5-6 years. BP of the UK and Norway’s Statoil in the past 18 months signed similar deals with Chesapeake. Analysts said the deal’s price – $63,000 per barrel of current production – was in line with recent deals.