Exxon Expands on Green Output Plans
US major ExxonMobil is developing plans to boost earnings substantially while investing in low-emissions technology, CEO Darren Woods told shareholders May 29.
The US major was a relative late-comer to the Oil & Gas Climate Initiative and has been fighting court cases in the US over its past claims about what it knew about the extent and causes of climate change.
But he made clear that the company was now pursuing a cleaner agenda: “We are equally committed to helping society reduce global emissions while supporting growth and prosperity for communities around the world – effectively addressing the dual challenge,” he said.
ExxonMobil expects to increase annual earnings potential by more than 140% and double potential annual cash flow from operations by 2025 from 2017 adjusted earnings, assuming a 2017 oil price of $60/barrel adjusted for inflation and based on 2017 margins.
Woods highlighted progress on major upstream projects that are expected to help increase production to about 5mn barrels of oil equivalent (boe)/day by 2025. In Q1 it produced 3.98mn boe/d.
A fifth of that will come from the Permian Basin, where it aims to produce 1mn boe/d by 2024. In Guyana, ExxonMobil recently announced the 13th discovery on the Stabroek block, adding to the previously estimated 5.5bn barrels of discovered recoverable resource. Guyana’s first oil production is on track for early next year – just five years after discovery.
In Brazil, the company has acquired 2.3mn net acres in one of the world’s most promising exploration plays and is finalising development plans for the Carcara resource, which will begin production by 2024.
In Mozambique, ExxonMobil secured offtake commitments and government approval for the Rovuma LNG project as it progresses toward a final investment decision. And in Papua New Guinea, the company is planning a three-train liquefied natural gas expansion as it continues to explore for gas in the country’s Highlands region. Woods did not elaborate on the tricky political situation that could see that delayed.
Woods highlighted ExxonMobil’s continuing efforts to address society’s dual challenge of providing affordable energy necessary for economic growth while reducing environmental impacts.
Last year, ExxonMobil participated in a Vatican-led climate dialogue, joined the Oil and Gas Climate Initiative and advocated for policies such as a carbon tax and strong methane regulations.
Woods said the company continues its work on potential technology breakthroughs – including next-generation biofuels for transportation, carbon capture for power generation and new industrial processes to reduce energy use – to provide reliable, affordable and lower-emission energy at the necessary scale to have a global impact.
“The world needs additional solutions,” he said. “That’s where we think we can add significant value – leveraging ExxonMobil’s experience in the global energy system and our strong foundation in research and development.”
The company recently committed to spend “up to” $10mn/yr on average for a decade on research with the US Department of Energy’s National Renewable Energy Laboratory and National Energy Technology Laboratory to bring lower-emissions technologies to commercial scale.
“The agreement adds to our work with more than 80 universities around the world and with five energy centers – at MIT, Princeton, Stanford, the University of Texas and two national universities in Singapore,” said Woods. “In addition, we partner with private sector companies that have unique capabilities critical to potential breakthroughs, such as Synthetic Genomics on algae biofuels.”