Exxon Board Debates Dropping Oil and Gas Projects in Mozambique and Vietnam - WSJ

Arathy S Nair
Thursday, October 21, 2021

Exxon Mobil Corp board is debating whether to continue with several major oil and gas projects amid a global push from investors for fossil fuel companies to be more cost-conscious and green-energy friendly, WSJ reported on Wednesday.

Activist investor Engine No. 1 in May shocked the oil-and-gas industry when three of its four nominees were elected to the board by Exxon shareholders, who were frustrated by weak returns and the company's flagging attention to climate concerns.

The appointment of activist Jeff Ubben in March put a third of the 12-member board in new hands.

The board members expressed concerns about some projects, including a $30 billion liquefied natural gas development in Mozambique and another multibillion-dollar gas project in Vietnam, the WSJ report said, citing people familiar with the matter.

Exxon did not immediately respond to a Reuters request for comment.

The Mozambique and Vietnam projects have been stalled for long periods over local fights as well as sour gas and high costs. No final investment decisions have been taken on these projects.

The talks on projects are taking place as part of a review of Exxon's five-year spending plan, on which the board is set to vote at the end of this month, WSJ reported.

Exxon is also analyzing the expected carbon emissions from each project and how they would affect its ability to meet pledges to reduce emissions, the report said.

The annual projected emissions from the Mozambique and Vietnam projects were among the highest in Exxon's planned pipeline of oil and gas projects, according to a pre-pandemic internal analysis by Exxon, which was reviewed by WSJ.

Exxon is also planning to declare in coming weeks that it will raise its investment in a low-carbon unit it announced in February by billions of dollars, the Journal added.

Exxon had in February said it would invest $3 billion through 2025 in a new division that would commercialize its carbon capture and storage, hydrogen, biofuels and other technologies. 

(Reporting by Arathy S Nair in Bengaluru; Editing by Arun Koyyur)

Categories: Decarbonization Asia Africa

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