ExxonMobil Outlines Plans to Grow Long-Term Shareholder Value in Lower Carbon Future
- Industry-leading investment portfolio profitable at low prices and flexible to market conditions
- Plans through 2025 increase earnings, cash flow to sustain and grow dividend, reduce debt and advance advantaged projects
- Technology leadership to develop lower carbon solutions and create future value
“We are fully committed to growing shareholder value by meeting the world’s energy demands today and pursuing a technology-driven strategy to succeed through the energy transition,”
“Our investment portfolio is the best we’ve had in over 20 years, and will grow earnings and cash flow in the near term while remaining flexible to market conditions and benefiting from ongoing cost-reduction efforts. Looking ahead, we’re working to reduce our emissions and develop solutions, such as carbon capture and low-carbon hydrogen, needed to de-carbonize the highest emitting sectors of the economy – a critical requirement for society to achieve its net zero ambition.”
Future spending plans take into account potential market volatility as the economy recovers from the pandemic.
“Our investments are expected to generate returns of greater than 30 percent,” said Woods. “And 90 percent of our upstream investments in resource additions, including in
To grow shareholder value through the transition to a lower carbon economy,
The company’s newly created business, ExxonMobil Low Carbon Solutions, was established to commercialize low-emission technologies, and will initially focus on carbon capture and storage (CCS), the process of capturing CO2 that would otherwise be released into the atmosphere from industrial activity, and injecting it into deep geologic formations for safe, secure and permanent storage.
Using estimates and demand projections, including from IPCC Lower 2 degree Celsius scenarios, the market for CCS and other low-emission technologies and products is expected to grow significantly by 2040.
“Our development of next-generation technologies and existing businesses positions us well to capitalize on the growing demand for de-carbonization and market opportunities that are increasingly coming together to support lower-carbon energy solutions,” said Woods.
The company’s 2025 emission reduction plans include a 15 to 20 percent reduction in upstream greenhouse gas intensity versus 2016 levels, supported by a 40 to 50 percent reduction in methane intensity and 35 to 45 percent reduction in flaring intensity.
The plans are expected to reduce absolute greenhouse gas emissions by an estimated 30 percent for the Upstream business. Absolute flaring and methane emissions are expected to decrease by 40 to 50 percent under the plans. The company also aims for industry-leading greenhouse gas performance and to eliminate routine flaring in line with the
Outlooks; projections; goals; estimates; descriptions of strategic plans and objectives; planned capital and cash operating expense reductions and the ability to meet or exceed announced reduction objectives; plans to reduce future emissions intensity and the expected resulting absolute emissions reductions; emission profiles of future developments; carbon capture results and the impact of operational and technology efforts; future business markets like carbon capture or hydrogen; the impacts of the COVID-19 pandemic and corresponding market impacts on ExxonMobil’s businesses and results; price and market recoveries; energy market evolution; recovery and production rates; rates of return; development plans; future distributions and debt levels; product mix and sales growth; and other statements of future events or conditions in this release are forward-looking statements. Actual future results could differ materially due to a number of factors. These include global and regional changes in the demand, supply, prices, differentials or other market conditions affecting oil, gas, petroleum, petrochemicals and feedstocks; company actions to protect the health and safety of employees, vendors, customers, and communities; the ability to access short- and long-term debt markets on a timely and affordable basis; the severity, length and ultimate impact of COVID-19 and government responses on people and economies; global population and economic growth; reservoir performance and depletion rates; the outcome of exploration projects and the timely completion of development and construction projects; regional differences in product concentration and demand; war, trade agreements, shipping blockades or harassment and other political, public health or security concerns; changes in law, taxes or regulation, including environmental regulations, taxes, political sanctions and international treaties; the timely granting or freeze, suspension or revocation of government permits; the impact of fiscal and commercial terms and the outcome of commercial negotiations; feasibility and timing for regulatory approval of potential investments or divestments; the actions of competitors and preferences of customers; the capture of efficiencies within and between business lines; unexpected technological developments; general economic conditions, including the occurrence and duration of economic recessions; unforeseen technical or operating difficulties; the ability to bring new technologies to commercial scale on a cost-competitive basis, including large-scale hydraulic fracturing projects and carbon capture projects; and other factors discussed here, in Item 1A. Risk Factors in our Form 10-K for the year ended
Forward-looking statements contained in this release regarding the potential for future earnings, cash flow, margins, returns, rate of return, future market sizes, cash operating expenses, and net cash margin are not forecasts of actual future results. These figures are provided to help quantify the potential future results and goals of currently-contemplated management plans and objectives including new project investments, plans to replace natural decline in Upstream production with low-cost volumes, plans to increase sales in our Downstream and Chemical segments and to shift our Downstream and Chemical product mix toward higher-value products, continued high-grading of ExxonMobil’s portfolio through our ongoing asset management program, announced and continuous initiatives to improve efficiencies and reduce costs, capital expenditures and cash management, and other efforts within management’s control to impact future results as discussed in this release. These figures are intended to quantify for illustrative purposes management’s view of the potentials for these efforts over the time periods shown, calculated on a basis consistent with our internal modelling assumptions for factors such as working capital, as well as factors management does not control, such as interest, differentials, and exchange rates. Price points referred to in this release are not intended to reflect ExxonMobil’s forecasts for future prices or the prices we use for internal planning purposes.
Definitions and additional information concerning certain terms used in this release including cash operating expense and net cash margin are provided in the Frequently Used Terms available on the Investor page of our website at www.exxonmobil.com under the heading News & Resources and in the
This release references third party scenarios such as the 74 Lower 2°C scenarios, made available through the IPCC SR 1.5 scenario explorer data and the IEA Sustainable Development Scenario. These third party scenarios reflect the modeling assumptions and outputs of their respective authors, not
The term “project” as used in this release can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports. The term “performance products” refers to chemical products that provide differentiated performance for multiple applications through enhanced properties versus commodity alternatives and bring significant additional value to customers and end-users.
This release summarizes highlights from ExxonMobil’s 2021 Analysts’ Meeting held on
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