ExxonMobil Becomes Final Oil Major To Pledge Net-Zero 2050
On January 18, 2022, just one month after ExxonMobil pledged net-zero Permian Basin operations by 2030, the oil and gas giant announced the goal to become a net-zero energy company by 2050.
The net-zero aspiration applies to Scope 1 and Scope 2 greenhouse gas emissions and builds on ExxonMobil’s 2030 emissions-reductions plans, which include net-zero emissions for Permian Basin operations and ongoing investments in lower-emissions solutions, including carbon capture and storage (CCS), hydrogen, and biofuels.
“ExxonMobil is committed to playing a leading role in the energy transition and Advancing Climate Solutions articulates our deliberate approach to helping society reach a lower-emissions future,” said Darren Woods, chair and chief executive officer of ExxonMobil. “We are developing comprehensive roadmaps to reduce greenhouse gas emissions from our operated assets around the world, and where we are not the operator, we are working with our partners to achieve similar emissions-reductions results.”
The report provides details of how ExxonMobil’s business strategy is resilient when tested against a range of Paris-aligned net-zero scenarios, including the United Nations Intergovernmental Panel on Climate Change’s 2018 Special Report and the International Energy Agency’s Net Zero by 2050 scenario.
ExxonMobil’s Outlook for Energy, which is based on current policy and technology trends, continues to be the basis for the company’s business plans and investment decisions. In the Advancing Climate Solutions report, the company outlines how its short- and medium-term business plans are adjustable to developments in policy and technology and how it uses signposts and leading indicators to evaluate the need for any changes in future years.
ExxonMobil believes that sound government policies will accelerate the deployment of key technologies at the pace and scale required to support a net-zero future. ExxonMobil continues to support an explicit price on carbon to establish market incentives and encourage investments in lower-emissions technologies.
ExxonMobil is also committed to helping customers reduce their greenhouse gas emissions by investing in CCS, hydrogen, and biofuels. Bio-based feed and plastic waste streams provide further opportunities for lowering greenhouse gas emissions. “As we invest in these important technologies, we will advocate for well-designed, high-impact policies that can accelerate the deployment of market-based, cost-effective solutions,” said Woods. “We believe our strategy is unique among the industry and enables us to succeed across multiple scenarios. We will create shareholder value by adjusting investments between our existing low-cost portfolio and new lower-emissions business opportunities to match the pace of the energy transition.”
To help reach net zero for operated assets by 2050, the company has identified more than 150 potential steps and modifications that can be applied to assets in its upstream, downstream, and chemical operations.
Initial actions already underway prioritize energy efficiency measures, methane mitigation, equipment upgrades, and the elimination of venting and routine flaring. Further high-impact reduction opportunities include power and steam co-generation and electrification of operations, using renewable or lower-emissions power. The company expects to finalize detailed roadmaps that address approximately 90% of operations-related greenhouse gas emissions by the end of this year, and the remainder will be completed in 2023.
Initial steps to achieve net zero by 2050 are included in the company’s plans to invest more than US$15 billion by 2027 on lower-emissions initiatives. Policies further accelerating the development and deployment of lower-emissions technologies could provide ExxonMobil with additional investment opportunities.
The Advancing Climate Solutions report expands on the company’s 2030 greenhouse gas emissions-reductions plans, which are consistent with Paris-aligned pathways, the United States and European Union’s Global Methane Pledge, and the US Methane Emissions Reductions Action Plan. Compared to emission levels in 2016 at the time of the Paris Agreement, the 2030 plans include a 20% to 30% reduction in corporate-wide greenhouse gas intensity, which includes a 40% to 50% reduction in upstream greenhouse gas intensity, 70% to 80% reduction in corporate-wide methane intensity, and 60% to 70% reduction in corporate-wide flaring intensity.
The 2030 emissions-reductions plans are expected to achieve World Bank Zero Routine Flaring by 2030 and reduce absolute greenhouse gas emissions by an estimated 30% for the company’s upstream business and 20% for the entire corporation. Similarly, absolute flaring and methane emissions are expected to decrease by 60% and 70%, respectively, by 2030.
