- Exxon Mobil (NYSE:XOM) +1.3% pre-market after unveiling plans to "increase earnings and cash flow to sustain and grow its dividend, reduce debt and fund advantaged projects, while working to commercialize lower emission technologies in support of the goals of the Paris Agreement."
- Exxon plans capital spending of $16B-$19B in 2021 and $20B-$25B annually through 2025 on high-return, cash-accretive projects, which can be modified to reflect market conditions.
- The company says it cut capital spending by 30% and cash operating expenses by 15% in 2020, and it expects to see $6B/year in permanent structural savings by the end of 2023 from 2019 levels.
- "Our investments are expected to generate returns of greater than 30%," CEO Darren Woods says at the company's investor day, noting that 90% of upstream investments in resource additions, including in Guyana, Brazil and the Permian Basin, generate a 10% return at $35/bbl or less.
- Exxon expects its emission reduction plans will reduce absolute greenhouse gas emissions by 30% for the Upstream business, while it "aims for industry-leading greenhouse gas performance and to eliminate routine flaring in line with the World Bank initiative by 2030."
- Exxon's actions are too dependent on maintaining its lofty dividend, as it pursues short-term goals to the detriment to long-term ones, Stanislas Capital writes in a neutral analysis posted recently on Seeking Alpha.
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