ExxonMobil Corp. has added 17,800 net acres to its Permian Basin portfolio in a swap of some of its California land with Linn Energy LLC.

The cashless exchange would hand ExxonMobil subsidiary XTO Energy Inc. land in the Permian’s Midland sub-basin core area of West Texas that is prospective for horizontal Wolfcamp Shale and Spraberry formation development that currently is producing about 4,700 boe/d. XTO also would receive 800 net acres in the Permian’s Delaware sub-basin in New Mexico.

“We continue to expand our leasehold position in a prolific area that is poised for profitable volumes growth from multiple horizons in the Wolfcamp and Spraberry formations,” said XTO President Randy Cleveland. “Our operated-acreage position in the Midland Basin Wolfcamp core is now around 120,000 net acres. We continue to increase drilling activity in the play, currently operating six horizontal rigs, and are very encouraged by initial well results.”

In exchange, Linn would receive stakes in around 500 net acres of ExxonMobil’s Hill property in the South Belridge Field near Bakersfield, CA. The field currently produces 3,400 b/d, 100% weighted to oil with a shallow base decline of 10%. Proved reserves are estimated at 27 million boe, 51% developed.

Linn management said it had identified “significant upside potential through optimization projects, increased steam injection and extensive down spacing from more than 300 future drilling locations.” Total reserve potential for the property is estimated at around 67 million boe.

“Our California team has done an excellent job this year of growing Diatomite production and managing our legacy fields,” said Linn CEO Mark E. Ellis.

The mature assets, which have an estimated reserve life of 22 years, currently generate more operating cash flow than the Permian properties, according to Linn. Management is estimating 300 future drilling locations on the property.

Linn still has some assets to sell in the Permian Basin, with about 13,000 net acres in the Midland sub-basin prospective for Wolfcamp drilling and production of around 10,000 boe/d.

“We continue to see strong interest in the market for a trade or sale of these remaining assets and believe there is significant additional value for our unitholders,” Ellis said.

The agreement announced Thursday, which is set to close by the end of the year, is the second nonmonetary exchange this year between the two producers. In May, ExxonMobil added almost 26,000 net acres to its Permian position in return for giving Linn a sizable portion of its interests in the Hugoton natural gas field in Kansas and Oklahoma (see Shale Daily, May 22).

The latest agreement with Linn extends ExxonMobil’s position across the Permian to more than 1.5 million acres, with total net production now standing at more than 95,000 boe/d.