ExxonMobil is meeting investors’ demand to intensify climate goals by unveiling plans to manage its carbon emissions and outlined its specific goals through 2025. This contrasts rivals that have set targets to eliminate their emissions in longer-term plans through 2050. Exxon’s CEO Darren Woods said that tools and technology needed to achieve larger targets are yet to be built, adding that it is difficult to set timelines for innovation and breakthroughs.
While other oil majors are set to embark on the renewable energy sector, Exxon’s new plans highlight that it will continue to stick with its existing strength. Woods claimed that Exxon had a competitive edge in carbon management as it had used carbon for years in enhanced oil recovery. He also said that carbon capture with underground sequestration could serve as a more cost-effective way to reduce emissions compared to other strategies such as electric vehicles, low-carbon fuel credits, and carbon pricing.
Exxon expects the global carbon capture market could grow by 35% annually to hit $2 trillion by 2040. This market includes carbon sequestration and using it to make steel and cement. The company also has a leading position in hydrogen, with a production capacity of 1.3mn tons/year. It said the global hydrogen market could expand by 30% every year to hit $1 trillion by 2040. Hydrogen-powered fuel cells can help reduce emissions in the transportation and manufacturing industries, Woods says.
Exxon’s new carbon management plans receive mixed reactions from investors. Following the announcement, the company’s shares rose nearly 4%. Meanwhile, activist firm Engine No 1 was not impressed, saying that the plans are still a half measure. Engine No 1 and its partners under the Coalition United for a Responsible Exxon (CURE) have been calling Exxon for more capital discipline and more commitments to net-zero emissions.
