Exxon Plans To Merge Fuels, Lubricants Divisions

Exxon Mobil plans to merge two of its products divisions, a sign of the times for big oil companies, which generally are sharpening their corporate focus on the growing challenges of exploration and production.

The largest U.S. oil company said on Wednesday it expects its Lubricants & Petroleum Specialties Co to merge with its Fuels Marketing Co, effective Feb. 1, 2012, subject to board approval.

This follows last year's move by Chevron to merge its chemicals and refinery units into one integrated "downstream" division, as it favors investment in the steadier and recently far more lucrative "upstream" business of oil and gas extraction.

Chevron has since shrunk its downstream profile worldwide, selling off several marketing units and its British refinery.

Others are abandoning downstream operations altogether, including ConocoPhillips and Marathon Oil.

Exxon said the merged unit is set to be run by Alan Kelly, now president of the lubricants arm, which is home to the Mobil 1 motor oil brand and which Exxon says is the world's top supplier of lubricant basestocks, with 18 percent market share.

Fuels Marketing is responsible for customers at 42,000 service stations, 700 airports and 300 marine ports. Its president, Harold Cramer, is stepping down at the end of the month after 38 years with the company. Exxon has two other divisions responsible for refining and chemicals.

Conoco took another step on Wednesday toward splitting from its downstream unit, Phillips 66, by naming three executives to run it ahead of the planned separation in the second quarter of next year.

Greg Maxwell, currently the chief financial officer of joint venture Chevron Phillips Chemical, will become CFO of Phillips 66, Conoco said. Tim Taylor will lead commercial, marketing, transportation and business development for the new company, while Chantal Veevaete will run its human resources. Both are also formerly of Chevron Phillips Chemical.