Page 11 - NorthAmOil Week 48 2021

NorthAmOil ENERGY TRANSITION NorthAmOil

ExxonMobil steps up emissions-cutting

plans in medium-term corporate strategy

GLOBAL EXXONMOBIL announced this week that it for not going far enough. Andrew Logan, senior
had finalised its corporate plans until 2027. The director for oil and gas at Ceres, which co-or-
plans envisage the super-major doubling its dinates investor action on climate change, was
earnings and cash flow by 2027 compared with quoted by the Financial Times as describing the
2019 levels. It intends to achieve this by focusing new targets as “grossly inadequate”, adding that
on “continued structural cost savings, invest- ExxonMobil was “losing ground relative to its
ment in low-cost-of-supply and lower-emission peers”.
products and further portfolio high-grading”. The targets mark the first time that Exxon-
In addition, the plans include ramping up Mobil has updated its corporate strategy since
spending on greenhouse gas (GHG) emission nominees of activist hedge fund Engine No. 1
reduction efforts to $15bn over the period up to won three seats on the super-major’s board ear- ExxonMobil’s
2027. ExxonMobil said it had developed “more lier this year. The fund is aimed at meeting the
aggressive” plans to target Scope 1 and Scope challenges of the energy transition, but links shares are up
2 emissions – those produced directly from its sustainability with profitability. Its campaign
operations and indirectly from electricity, steam, for seats on ExxonMobil’s board focused on around 60%
heating and cooling required to power its opera- claims that the company’s financial perfor-
tions respectively. mance would suffer if it did not do more to since November
The new targets include cutting compa- decarbonise, and this argument won enough 2020.
ny-wide Scope 1 and 2 emissions intensity by shareholder support to secure three board
20-30% by 2030, and upstream intensity by seats out of four targeted.
40-50% over the same period. Its previous goal ExxonMobil’s shares are up around 60% since
was an intensity reduction of 15-20% by 2025 for November 2020, when Engine No. 1 bought
its upstream business, but it said it had already them, and while this could also be the result
met that target this year. of rising oil and gas prices, this compares with
ExxonMobil is also targeting a 70-80% cut in an increase of roughly 30% for rival Chevron’s
company-wide methane intensity and a 60-70% shares.
reduction in flaring intensity by 2030. Charlie Penner, who ran Engine No 1’s Exx-
The updated targets fall short of the more onMobil campaign before recently leaving the
aggressive decarbonisation goals adopted by fund, was quoted by the Financial Times as
European super-majors, all of whom have set saying the super-major’s increased low-carbon
out plans to pursue net-zero GHG emissions in spending was positive “if the focus is building
the long term. Unsurprisingly, environmental scalable and profitable businesses, versus gener-
groups criticised ExxonMobil’s updated targets ating advertising”.™

Week 48 02•December•2021 www. NEWSBASE .com P11