Exxon Mobil Corporation XOM has reinforced its longstanding energy partnership with Azerbaijan by signing a fresh memorandum of understanding (MoU) with the country’s state energy company, SOCAR. The agreement, finalized during the Baku Energy Week and signed by SOCAR president Rovshan Najaf and ExxonMobil vice president John Ardill, focuses on collaborative exploration, development and production of onshore oil and gas resources in Azerbaijan.
The deal underscores ExxonMobil’s commitment to playing a critical role in Azerbaijan’s next phase of energy development, particularly in unconventional onshore reserves. It also marks a continuation of the American majors’ historical engagement in the region, where XOM already holds stakes in the Azeri-Chirag-Gunashli oil field and the Baku-Tbilisi-Ceyhan pipeline.
XOM-SOCAR Alliance Aims to Unlock Unconventional Potential
This latest agreement is aimed at evaluating unconventional hydrocarbon opportunities in Azerbaijan, which could represent a strategic diversification for the country as it seeks to stabilize long-term output. Azerbaijan currently relies heavily on mature offshore fields in the Caspian Sea, while onshore production accounts for just 5% of its overall oil output.
Unconventional resources, such as those trapped in shale or tight rock formations, require advanced technologies, including hydraulic fracturing. ExxonMobil’s deep experience in such operations, especially in North America, makes it a key partner as Azerbaijan considers unlocking these technically challenging reserves.
John Ardill stated that XOM’s partnership with SOCAR focuses on evaluating the potential size and economic viability of unconventional resources in Azerbaijan, which could open a new frontier for the country’s energy sector.
SOCAR Expands Global Outreach Alongside XOM Deal
Along with its renewed collaboration with ExxonMobil, SOCAR is also strengthening energy cooperation with Canadian oil producer Gran Tierra Energy. The MoU will support hydrocarbon assessment in the Guba-Caspian region, though ExxonMobil is not involved in the particular initiative.
SOCAR’s recent activities, including becoming a license winner for natural gas exploration in Israel’s Exclusive Economic Zone, underscore the company's ambition to build a broader international footprint and attract partnerships with Western majors.
XOM Looks Ahead in Azerbaijan’s Evolving Energy Landscape
For ExxonMobil, the MoU with SOCAR is more than a standalone agreement — it is a stepping stone toward deeper involvement in Azerbaijan’s evolving energy strategy. As the country looks to balance traditional oil production with exploration of new frontiers, ExxonMobil is positioning itself to provide technical leadership and long-term investment.
With Azerbaijan targeting a steady oil output of around 582,000 barrels per day and expanding its energy footprint beyond borders, ExxonMobil’s continued alignment with SOCAR highlights a shared vision for stability, innovation and cross-border collaboration in a shifting global energy landscape.
XOM’s Zacks Rank & Key Picks
XOM currently carries a Zack Rank #4 (Sell).
Investors interested in the energy sector may look at some better-ranked stocks like Subsea 7 S.A. SUBCY, Energy Transfer LP ET and RPC Inc. RES. Subsea 7 presently sports a Zacks Rank #1 (Strong Buy), while Energy Transfer and RPC carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
Subsea 7 helps build underwater oil and gas fields. It is a top player in the Oil and Gas Equipment and Services market, which is expected to grow as oil and gas production moves further offshore.
The Zacks Consensus Estimate for SUBCY’s 2025 EPS is pegged at $1.31. The company has a Value Score of A.
Energy Transfer is poised to benefit from long-term fee-based commitments. It is also focused on expanding operations through organic and inorganic initiatives. The firm is looking for solutions to meet growing energy demands from additional demand centers through its pipeline network. Energy Transfer’s systematic investments should boost its total fractionation capacity at Mont Belvieu and raise its top line.
The Zacks Consensus Estimate for ET’s 2025 EPS is pegged at $1.44. The company has a Value Score of A.
RPC generates strong and stable revenues through a diverse range of oilfield services, including pressure pumping, coiled tubing and rental tools. The company is strongly committed to returning value to shareholders through consistent dividends and share buybacks. RPC’s current dividend yield is higher than that of the composite stocks in the industry. Its new Tier IV dual-fuel fleet has boosted profits, with plans to further expand high-efficiency equipment to enhance operational capabilities.
The Zacks Consensus Estimate for RES’ 2025 EPS is pegged at 38 cents. The company has a Value Score of A.
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Exxon Mobil Corporation (XOM): Free Stock Analysis Report Energy Transfer LP (ET): Free Stock Analysis Report RPC, Inc. (RES): Free Stock Analysis Report Subsea 7 SA (SUBCY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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