Energy giant ExxonMobil made a series of announcements today ahead of its annual Investor Day presentation, including plans for billions of dollars in investments in emissions reductions and low-emissions business opportunities, as the company says it aims to lead in the energy transition.
Darren Woods, ExxonMobil Chairman and Chief Executive Officer, said:
“We are focused on leading the industry in safety, reliability, environmental performance, earnings and cash flow growth – and ultimately shareholder returns. We’ll continue to innovate and provide solutions that meet the growing needs of society, including its net-zero emissions ambitions, by fully leveraging our competitive advantages of scale, integration, technology, functional excellence, and our highly skilled people.”
Today’s announcement includes plans by Exxon to invest more than $15 billion over the next six years to reduce greenhouse gas (GHG) emissions in its operations, and in lower-emission business opportunities to help customers reduce emissions. The company established a Low Carbon Solutions business last year, focused on areas including carbon capture and storage, hydrogen and biofuels.
In a separate announcement, Exxon unveiled plans for a hydrogen production plant, and one of the world’s largest carbon capture and storage projects, at its integrated refining and petrochemical site at Baytown, Texas. The facility would produce blue hydrogen, which is typically produced by converting natural gas into hydrogen and CO₂, which is then captured and permanently stored. The plant would produce up to 1 billion cubic feet per day of blue hydrogen, and the project would have the capacity to transport and store up to 10 million metric tons of CO2 per year.
Joe Blommaert, president of ExxonMobil Low Carbon Solutions, said:
“Hydrogen has the potential to significantly reduce CO2 emissions in vital sectors of the economy and create valuable, lower-emissions products that support modern life. By helping to activate new markets for hydrogen and carbon capture and storage, this project can play an important part in achieving America’s lower-emissions aspirations.”
The announcements align with the recent significant change in tone from Exxon over the past few months. At 2020’s analyst day, Woods described peer companies’ carbon pledges as a “beauty contest.” Last year, Exxon was involved in a high-profile proxy battle which saw activist investor Engine No. 1 win three seats on the company’s board, marking a major victory for investors pushing the oil and gas giant to act on the emerging global energy transition to clean and renewable sources of energy. Earlier this year, the company announced its first ever net zero target, with a commitment to achieve net zero scope 1 and 2 emissions by 2050. While marking a significant step for the company, however, the net zero goal does not encompass ‘scope 3’ emissions, which make up the most significant source of the company’s climate impact.
“Investment in emission-reduction opportunities will accelerate with advances in technology, market incentives and supportive policy. We’ve built a portfolio with flexibility to adjust investments between our traditional oil, gas and products business and new lower-emissions opportunities, consistent with the pace and scale of the energy transition, creating long-term value across a broad range of scenarios.”