ExxonMobil outlines its lower carbon future

Houston — ExxonMobil hosted its Low Carbon Solutions Spotlight, to explain how the company is “growing its Low Carbon Solutions business, to help accelerate progress toward reaching society’s net-zero goals.” In a presentation to investors, Chairman and CEO Darren Woods and Dan Ammann, President of Low Carbon Solutions, said that ExxonMobil could deliver emissions-reduction solutions “at a scale that matters.”

The firm said its ambition is for exponential growth in the Low Carbon Solutions business in the coming years, as demand expands for products and services like carbon capture and storage (CCS), hydrogen and biofuels. According to the executives, ExxonMobil is focused on the hardest-to-decarbonize sectors, including heavy industry, commercial transportation and power generation. Together, those areas account for 80% of global energy-related CO2 emissions, they said.

Capital allocation for emissions. In addition, Woods and Ammann said that the firm’s Low Carbon Solutions business can help their customers significantly reduce emissions. Current planned projects could abate about 20 MMmt of CO2 per year. Furthermore, with ExxonMobil’s pipeline of potential new projects, they say the company could abate nearly four times as much. Analysts at Morgan Stanley noted that the firm reiterated its intentions to devote around $17 billion in lower-emissions spending during the 2022-2027 period. Of that amount, about 60% will go toward reducing the ExxonMobil’s own emissions, with the other 40% dedicated to reducing third parties’ emissions. “Importantly, the company emphasized that its low-carbon investments must compete for capital with the rest of its traditional business segments,” noted the Morgan Stanley analysts.

CCS progress. Woods and Ammann stated that ExxonMobil expects revenue from its first CCS projects may begin as early as 2025. Accordingly, they announced a long-term agreement with Linde. As part of the deal, the operator will transport and permanently store as much as 2.2 MMtpa of CO2 from the new Linde clean hydrogen plant in Beaumont, Texas. In addition, ExxonMobil said it is moving forward with CF industries on its CCS project in Louisiana. Morgan Stanley said the project will capture up to 2.0 MMtpa of CO2 from CF facility in Donaldsonville, La, beginning in 2025.

Hydrogen efforts. The executives also extolled their efforts to harness hydrogen. One such project is the new 1-Bcfd blue hydrogen facility in Baytown, Texas. They said that site work has begun on what will be the world’s largest low-carbon hydrogen producer at start-up in 2027-2028.

Finally, ExxonMobil said that it continues to make progress on our own emissions goals.The firm is on track to reduce corporate-wide greenhouse gas emissions intensity (Scopes 1 and 2) from operated assets 20% to 30% by 2030, compared to 2016’s levels.