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Exxon Mobil Corp. intends to reduce or offset greenhouse-gas emissions from its operations, hitting net zero by 2050, as investor and public pressure has intensified on the energy sector to address the climate change its products accelerate.
The U.S. oil giant
XOM,
said Tuesday it has emission-reduction plans for major facilities and assets and can profitably navigate the global shift toward renewable energy sources.
Exxon believes it can achieve its goal through energy-efficiency measures, reducing methane leaks, upgrading equipment and eliminating the venting and routine flaring of natural gas.
Exxon’s goal doesn’t cover emissions from the refined oil
CL00,
natural gas
NG00,
and gasoline
RB00,
it produces, rather focuses on operations. Further, it doesn’t apply to oil fields or other assets it is invested in but doesn’t operate.
In December, Exxon said it would reach net-zero emissions by 2030 in the Permian Basin in Texas and New Mexico, one of the company’s most vital assets.
Environmental groups and others have criticized oil companies for not pledging more to outright slash greenhouse gases from their products. The emissions created by consumers are known as “scope 3” emissions.
Last May, Exxon lost three seats on its board of directors at its annual shareholder meeting to the activist hedge fund Engine No. 1, which is seen by some as pushing the company faster toward clean energy. Others said this particular push-in had the makings of “all talk, no action.”
Exxon was the last holdout among energy majors to make a substantial pledge. European interests BP PLC
BP,
and Royal Dutch Shell
RDS.A,
made similar announcements in 2020. U.S.-based Chevron Corp.
CVX,
said in October it had set a net-zero aspiration and has made tech-based investments toward scaling carbon-capture capabilities.
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Exxon’s stock is up some 50% over the past year, as the economy bounced back from the worst of the COVID-19 slowdown.
U.S. greenhouse gas emissions rebounded sharply from a COVID-19 slump faster than the overall economy improved in 2021, according to analysis by the nonpartisan Rhodium Group.
Energy analysts had expected to see a planet-warming emissions snapback as industrial output picked up and more freight moved in 2021 than 2020. Still, the growth in pollution outpaced expectations, the report, out earlier this month. said.
Based on preliminary data for 2021, Rhodium Group estimates that economy-wide GHG emissions increased 6.2% relative to 2020, though emissions remained 5% below 2019 levels.
