Exxon May Make $10.9B Bid For U.K.'s Gulf Keystone

Exxon Mobil XOM, the largest U.S. oil company, may be mulling a $10.9 billion bid for British oil firm Gulf Keystone Petroleum Ltd., according to press reports in the U.K. on Sunday. The British daily paper the Independent reported on Sunday that Dow component Exxon Mobil had expressed interest in Gulf Keystone. The Independent did not cite sources. Texas-based Exxon did not comment on the speculation. The paper reported Gulf Keystone currently has a market value of about $2.33 billion. Exxon is said to be considering a bid for Gulf Keystone that is just under $12.50 a share based on current dollar/pound conversion rates and that it is probable the British firm may reject that offer. The Independent reported that Chevron CVX, the second-largest U.S. oil company, and China's Sinopec SNP, Asia's largest refiner, are keeping an eye on the situation. If successful in its bid for Gulf Keystone, the acquisition would be the largest for Exxon since the $41 billion purchase of XTO, which was announced almost exactly two years ago and made Exxon the largest U.S. natural gas producer. Gulf Keystone makes for an appealing target because the company is believed to be sitting on massive oil reserves in Iraq's Kurdistan region. Last month, it emerged that Exxon was the first of the oil industry's giants to enter Kurdistan, taking six licenses, the Independent reported.