Occidental Petroleum Corp. on Thursday said it agreed to purchase Exxon Mobil Corp.'s stake in three oil fields in Texas for $972 million.


The output being acquired is primarily from the Salt Creek, Sharon Ridge and Dollarhide fields in the Permian Basin of west Texas, L.A.-based Occidental said in a press release.


Together with two smaller Permian acquisitions concluded in the first quarter and another acquisition being negotiated, the Exxon Mobil deal will add at least 130 million barrels of oil equivalent in Permian Basin reserves.


The transactions, which will be financed from cash on hand, are expected to add nearly 26,000 net barrels of oil equivalent to Occidental's daily output, getting the company within reach of meeting its year-end goal of increasing daily output by 6 percent to the equivalent of 600,000 barrels of oil.


"These transactions further strengthen our industry-leading position in the Permian Basin and are consistent with our strategy of focusing on large, long-lived assets in our core geographic areas," Ray R. Irani, Occidental's chairman and chief executive officer.


Occidental has been adding mature oil fields to its U.S. portfolio at a time when the largest oil companies are de-emphasizing their on-shore U.S. assets. Occidental was already the biggest producer in the Permian Basin in Texas and New Mexico after its $3.6 billion purchase of a venture owned by Europe's BP Plc and Royal Dutch/Shell Group in 2000.

For reprint and licensing requests for this article, CLICK HERE.