(WO) - ExxonMobil, as everyone by this point knows, announced that it plans to acquire Pioneer Natural Resources. With that in mind, ExxonMobil officials, including Senior V.P. Neil Chapman, held a media briefing on Wednesday morning (Oct. 11), to further articulate the situation. What follows are some highlights of that discussion, including the company’s drilling plans, shale outlook and midstream operations.

Shale plans. With Pioneer’s considerable additions from the Permian basin, ExxonMobil’s shale division plans were front and center in the discussion, on the Oct. 11 call with company executives. However, they noted no immediate plans to appoint a new head of their shale division, which would replace the current effective head, Liam Mallon. Company executives stressed that, first and foremost, ExxonMobil was very invested in becoming an integrated organization, leveraging both new and existing assets—along with considerable knowledge—towards future goals.

On that note, company executives noted that they were still committed to the earlier goal of production reaching 1 MMbopd from existing ExxonMobil assets. As it stands, the company is already producing approximately 700,000 bopd from assets across the Permian Basin alone, and when combined with Pioneer’s Permian assets, total estimated production is 1.3 MMbopd. Company executives added that ExxonMobil is looking to reach an additional goal of 2 MMbopd by 2027, with combined production from ExxonMobil and Pioneer assets.

Midstream operations also stand to get a boost with the merger, with ExxonMobil particularly keen to leverage its existing Gulf Coast midstream operations with Pioneer’s, for greater yield and overall lower costs. Executives mentioned that midstream would have a role in achieving ExxonMobil’s 1-MMbopd production goals, as well.

In terms of drilling, ExxonMobil has considerable existing capacity across its global operations. During this call, the company’s expertise in drilling extended laterals—up to 4 miles long, compared with the more conventional 1-to-2-mile length—was of particular note. Executives emphasized the unique requirement for continuous acreage; Pioneer holds some of the largest continuous acreage in the Permian basin, and when added to ExxonMobil’s existing assets, the company foresees greater opportunity to use these extra-long laterals in future.

Drilling practices. ExxonMobil also hopes to leverage its knowledge and expertise in drilling “cubes”—multiple horizontal wells put to work from the same pad, a practice also known as “cube development”—with Pioneer assets. ExxonMobil’s experience with the drilling practice stretches back to its first foray in 2018, and company executives noted that the firm is one of the most experienced in the field, compared with other Permian operators.

The company expects to see similar shale consolidation in the future, given the “finite” outlook of individual shale assets, without a broader portfolio to back them up. Company executives stressed ExxonMobil’s unique position—as a company involved in a wide range of fields within the oil and gas industry—as a specific outlook advantage that they hope to apply to Pioneer’s high-value assets.

Leveraging previous experience. The company also boasts considerably greater experience compared to some of its earlier takeovers—namely, the XTO Energy deal of 2010. Whereas then, the company was concerned with gaining knowledge of the unconventional space, with the Pioneer merger, ExxonMobil is now a leader in the unconventional space, looking to leverage that expertise along with Pioneer’s resources for enhanced operations.

ExxonMobil, according to company executives, has been looking to acquire Pioneer for some time, and accordingly, has considered an average ratio of stock price to value for the duration of the time since taking interest until actual purchase.

Capex spending, according to company executives, does not see any post-merger changes right away to Pioneer’s estimated $4.5 billion in spending on both capital expenditure and generating cashflow. An additional $4-5 billion spent on production also does not face any immediate change in the short term. ExxonMobil expects to add $2 billion to current dividends with the deal, but company executives emphasized a broader benefit: increased ability to deploy short-term capital and general flexibility, thanks to Pioneer’s added resources and assets.