Page 10 - NorthAmOil Week 32 2021

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ExxonMobil weighs
net zero pledge,
launches shale sale
US
SUPER-MAJOR ExxonMobil is reportedly considering making a pledge to pursue net zero greenhouse gas (GHG) emissions. This comes as the company finds itself under grow- ing pressure from investors over its stance on decarbonisation.
ExxonMobil’s CEO, Darren Woods, had pre- viously dismissed net zero targets set by certain European rivals as nothing more than a “beauty competition”, without a tangible plan to achieve such goals. However, last week the Wall Street Journal cited sources familiar with the matter as saying ExxonMobil was considering adopting such a target itself. If it does, this would mark a significant strategic shift by the super-major.
The sources said that ExxonMobil had not yet made a decision on net zero, but added that it would be unveiling a series of strategic moves on environmental and other issues before the end of 2021.
Earlier this year an activist investor, Engine No. 1, succeeded in having three of its nomi- nees elected to ExxonMobil’s board of direc- tors. Engine No. 1 is also aiming to transform the company, in part by making it significantly reduce its emissions. Woods said in late July that ExxonMobil had started working with the new directors in June for in-depth reviews of its businesses, including its approach to the energy transition.
In a development that will add to the grow- ing pressure ExxonMobil is facing on climate change issues, the company was suspended last week from the Climate Leadership Council (CLC), an advocacy group that it had helped to found. The move came weeks after an Exxon- Mobil lobbyist said the company only supported a carbon tax publicly because it would never gain enough political support to be adopted. Woods had condemned the comments.
Shale sale
Separately an ExxonMobil spokeswoman, Julie King, confirmed this week that the company’s XTO Energy shale unit had begun marketing certain non-core properties. The company is seeking buyers for almost 5,000 gas wells in the Fayetteville shale in Arkansas as it steps up a stalled asset sale programme in a bid to reduce debt, offload unwanted properties and raise what it hopes will amount to billions of dollars.
The Fayetteville assets are among those of ExxonMobil’s gas projects that have declining production and market value. The super-major
The Fayetteville assets are among those of ExxonMobil’s gas projects that have declining production and market value.
has increasingly narrowed its focus to its core assets in Guyana, offshore Brazil and the US’ Permian Basin in recent years.
ExxonMobil is hoping to receive bids for the Fayetteville assets by September 16 and close any sale by the end of the year. No buyers have been identified, and, in comments to Reuters, King declined to confirm the estimated value of the wells.
Reuters also reported that Dallas-based Merit Energy was evaluating the properties, according to a person familiar with the matter. Merit owns assets in the same area.
ExxonMobil acquired the Fayetteville assets in 2010 for $650mn, but subsequently saw the value of its US oil and gas operations fall by $17.1bn as the shale glut caused natural gas prices to crash. Marketing materials cited by Reuters show that output from the assets on offer has fallen by more than half since 2016 to about 160mn cubic feet (4.5mn cubic metres) per day last year.
The properties span 416,000 net acres (1,680 square km) and were cut from ExxonMobil’s development plan last year. The sale includes 844 operated and 4,104 non-operated wells, according to King.
ExxonMobil is about a third of the way towards its goal of selling $15bn worth of assets over the past three years.™
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w w w . N E W S B A S E . c o m Week 32 12•August•2021