Exxon Mobil Corp (XOM - Get Report) shares traded lower Wednesday after the oil major told investors it would spend as much as $65 billion over the next two years to expand its production facilities and increase shareholder returns.
Exxon said capital expenditures will rise around 24% from 2018, to an average of $32 billion over each of the next two years as part of a plan to boost longer-term profits. The group, which said yesterday it sees Permian Basin production to rise to 1 million barrels per day by 2024, lifted its 2025 target as well, forecasting gains of around 140% when compared to 2017 levels.
"Given the success we experienced last year and the progress we're making on our plans, we have even greater confidence in our ability to grow value for our shareholders," said CEO Darren Woods. "We are exceeding the pace of our expected progress on the aggressive growth strategy we laid out last year."
"We continue to enhance our industry-leading portfolio, and are leveraging our competitive advantages in integration, scale, technology and execution to deliver long-term value for our shareholders," Woods added.
Exxon shares were marked 2% lower at the start of trading Wednesday and changing hands at $78.58each, although the shares have gained nearly 20% since hitting a multi-year low -- alongside global crude prices -- on December 24.
Shares in domestic rival Chevron Corp. (CVX - Get Report) , which boosted its own capex plans in December for the first time in four years with an increase pegged at between $18 billion and $20 billion, edged 0.8% lower to $122.36 in early Wednesday trading.
The EIA said late last year that production from the country's seven biggest shale areas, including the Permian Basin, will rise to around 8.1 million barrels per day in early 2019. That's helped drive energy sector gains over the past three months, with the S&P Oil & Gas Exploration & Production total return index rising 25.5% since December 24.