ExxonMobil has also recently dipped its dollars into even more unconventional fuels.

In July, Exxon Mobil announced a deal with Craig Venter’s Synthetic Genomics to develop a new biofuel. It’s the biggest such deal, at up to $600 million, between an oil company and an alternative-fuel company

Exxon’s initial investment in its joint venture with Venter’s company is $300 million for Synthetic Genomics and another $300 million within Exxon on the joint venture. The oil company will work with Venter’s company on growing an algae that can produce biofuel that could be substituted for petroleum—the holy grail of biofuel research. If the research pans out, the company could spend billions getting it into mainstream use.

The deal announced this morning combines XTO's expertise and the access it has to natural gas deposits—it says it has access to 45 trillion cubic feet of gas—with Exxon's already-existing natural-gas plays and capital muscle. That makes the deal attractive, Tillerson said.

"It will enhance opportunities in production of America's own, clean-burning natural-gas resources," he said. His company estimates that natural-gas use will grow faster in the U.S. in coming years than either coal or petroleum use.

Bob R. Simpson, chairman and founder of XTO, said the deal combines the expertise his company has gained in its 23 years of what is called "unconventional" natural-gas extraction with the capital power of the nation's largest energy company.

That's a very important point, because it's not cheap to crack shale for natural gas.

"The perceived supply of natural gas is up tenfold in the United States in my career," Simpson said. "That capital needed to bring that resource into development is huge."

Leading up to the deal, Exxon has been investing heavily in improving ways to extract natural gas from unconventional reserves such as the Fort Worth's Barnett Shale natural-gas formation. Fort Worth, Texas-based XTO is the No. 2 producer of natural gas in the Barnett Shale.

Shale reserves such as the Barnett and similar formations in Louisiana and Pennsylvania generally are expensive and technically complex to drill.

While Exxon Mobil has been investing in improving natural-gas production technology, its oil-drilling focus means it will likely keep much of XTO's team intact, Bullock said.

"XTO is a solid company," he said. "They've always been a company that executes well. Exxon is going to need their top talent."

Once the deal is done, and it’s expected to be completed in the second quarter of 2010, Exxon will form a new organization for development of unconventional resources, to be located in the Fort Worth, Texas, offices currently occupied by XTO.