Multifaceted energy transition card helps ExxonMobil position itself for a low-emissions future

US-based energy giant ExxonMobil has made strides in pursuing a versatile approach to emissions reductions to leave its mark on the global decarbonization scoreboard, as there is no single solution to the energy transition puzzle.

Illustration; Source: ExxonMobil

Over the past few years, ExxonMobil has increased its efforts to reduce its greenhouse gas (GHG) emissions footprint. To this end, the U.S. oil giant announced in 2021 its scope 1 and scope 2 greenhouse gas emission reduction plans for 2030 compared with 2016 levels, covering operating assets. Under these plans, the company intends to achieve a 20-30% reduction in company-wide greenhouse gas emission intensity; a 40-50% reduction in greenhouse gas intensity in upstream operations; a 70-80% reduction in company-wide methane intensity; and a 60-60% reduction in company-wide flaring intensity. 70%.

Leading from this, U.S. energy heavyweights are working to advance a variety of technologies, including low carbon hydrogen, ammoniaand Carbon Capture, Utilization and Storage (CCUS), it is possible to significantly reduce emissions from industries that are difficult to reduce emissions, such as manufacturing and electricity. The company also plans to achieve net zero Scope 1 and 2 greenhouse gas emissions from its operating assets by 2050, supported by technological advancements and what the company believes should be clear and consistent government policy on this issue.

As the global political environment tends to send mixed signals on the energy transition agenda, depending on which region holds power and what geopolitical and other challenges the world is forced to grapple with, ExxonMobil’s Low Carbon Solutions business decided to create a LinkedIn 's poll asked participants to identify the main challenges their companies face during the energy transition.

The largest group of voters, 40%, is identified regulatory uncertainty As the main question, followed by financial constraints 26%, lack of infrastructure 21%, and technical barriers Finished last with 12% of the vote. The results of this poll are not surprising given the current global energy policy and investment climate.

While the US, like Australia and many other countries, has its regulatory hurdles to overcome, the UK tops the list of countries where political and fiscal uncertainty is considered to be wreaking havoc on energy investment, derailing the development of some projects due to . Some companies, such as Bureau Veritas, see current problems as hidden opportunities with the potential to turn into huge gains on the energy transition journey.

this American Petroleum Institute (API)The U.S. trade association representing the oil and gas industry sees industry collaboration on energy policy as an important factor in accelerating energy innovation and reducing emissions. The United States has made reducing methane emissions a priority for its domestic oil and gas industry to combat the risks of climate change. Consistent with this, the methane footprint from oil and gas operations has declined by 37% since 2015, while energy production in the largest U.S. basin has increased by 39%.

Mike SummersAPI President and CEO emphasized: “The U.S. oil and gas industry is a world leader in accelerating methane detection, reduction and reporting technologies and is preparing to release low-carbon hydrocarbons at scale. To fully leverage America’s energy advantage and drive climate progress, energy producers and policymakers Continued cooperation among stakeholders is crucial.

Additionally, the U.S. oil and gas industry is also stepping up its hydrogen game with many companies, including API, expecting it to play an important role throughout the low-carbon value chain, supporting the Biden administration’s stated goal of producing hydrogen. Metric tons (MMT) of hydrogen, to produce 50 MMT by 2050. Carbon dioxide emissions from industries that are difficult to electrify, such as cement.

With this in mind, ExxonMobil is doubling down on hydrogen, with plans to build what it says will be the world's largest low-carbon hydrocarbon production facility in Baytown, Texas. The US company aims to produce up to 1 billion cubic feet per day of natural gas-based low-carbon hydrogen at the plant, as it firmly believes that scaling up hydrogen solutions will help its customers achieve emissions reduction targets.Another solution the company identified to reduce its carbon footprint is to maximize Carbon Capture and Storage (CCS) effort.

In addition, ExxonMobil’s low-carbon vision also includes lithium, plans to be the first to launch this solution in North America by 2030, while playing a role in supporting the electric vehicle revolution as a way to leverage innovation and collaboration to accelerate society's path to net-zero emissions. Recently, American giants signed a Project Framework Agreement (PFA) with China ChecklistJapan's largest power generation companies will jointly explore the development of low-carbon hydrocarbon and ammonia production projects at their Baytown plant. The parties aim to jointly explore JERA's purchase of 5 MTA ammonia and participation in the ownership of the Baytown low hydrocarbon facility.

In addition, ExxonMobil also revealed the final agreement for the acquisition pioneer natural resources corp. All-stock deal in October 2023, valued at $59.5 billion. With production set to more than double to 1.3 million barrels of oil equivalent per day, it will create a Permian Basin giant, but that's not all.

The U.S. oil major not only aims to achieve net-zero Scope 1 and Scope 2 greenhouse gas emissions from its Permian unconventional operations by 2030, but also plans to use its Permian greenhouse gas reduction plan to accelerate Pioneer's Scope 1 and 2 net emissions. In addition, the U.S. oil giant will apply its technology to monitor, measure and address fugitive methane emissions to reduce the combined company's methane footprint.

Darren WoodsExxonMobil Chairman and CEO emphasized: “This premier Tier 1 asset is a perfect fit for our Permian portfolio and provides us with a better opportunity to deploy our technology and deliver operational and capital efficiencies to deliver long-term shareholder value.

“The combination of our two companies is good for this country’s energy security and economy, and will also further advance society’s environmental ambitions as we move Pioneer’s 2050 net zero emissions target towards 2035 plans.”

ExxonMobil recently strengthened its global hydrocarbons portfolio with a new oil discovery in Block 15 off the coast of Angola and a discovery of hydrocarbons in an exploration well in Petronas-operated Block 52 offshore Suriname .

Previously, the American giant discovered oil again in the Stabroek block offshore Guyana.

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