Diluting or Divesting?
Category: Just Plain Silly...
Posted Tuesday, May 25, 2004 at 03:31 PM [GMT-6]

I was amused by a quote in this article from today's MRT. The article reports on ExxonMobil's sale of 28 Permian Basin oil fields to Apache Corp. and quotes an ExxonMobil spokesman who is explaining why this isn't really a big deal:

"It's the normal course of asset hydrating -- upgrading of properties," Davis said.

I re-read the sentence, trying to get a handle on what exactly was meant by "asset hydrating," a term I was unfamiliar with despite helping to negotiate the acquisition and sale of a half billion dollars of oil and gas assets during my career. Then I figured it out. The reporter heard "hydrating" but the spokesman said "high-grading."

While I suspect that most of these fields are, indeed, producing more water than oil, I'm sure that it wasn't the result of anyone's intentional "hydrating" of them!

[Yeah, I know...you just have to be in the awl bidness to get it!]

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Comments

I have a lot of hydrating properties. Wanna' buy one?

Posted by: Wallace at May 26, 2004 09:53 AM

Boy, that sounds tempting, but I think I'll just blow my money on Florida swampland (it's well-hydrated too).

At $40/barrel, you can almost live with a 99% watercut!

Posted by: Eric at May 26, 2004 10:10 AM
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