ExxonMobil Doubles Down on Carbon Capture in $3-Billion Plan To Lower Emissions

ExxonMobil said the potential exists to collect millions of metric tons (Mt) of CO₂ from industrial plants that dot the coastal region which can then be stored in formations accessible from both onshore and offshore fields. Similar projects and partnerships are being considered in Europe and across Asia.

ExxonMobil noted in its announcement that it has been in the carbon-capture business for more than 30 years and currently collects around 9 million metric tons of CO₂ per year. The oil company owns equity in about 20% of global CCS capacity, representing facilities that account for nearly 40% of the world’s captured manmade emissions, according to ExxonMobil.

This looks like a major gamble for ExxonMobil.  Two of the planned seven projects are in the EU where there is an active carbon sequestration market. 

More than once though, the CEO described CCS as “a very complicated” sector, not least of which because of its dependence on regulatory frameworks to allow for a sustainable business.

Historically, that has contributed to the biggest problem with CCS, which is its inability to generate profits. This is changing, though, thanks to new tax incentives and the advent of carbon credits, which ExxonMobil expects to be selling to others as its efforts ramp up.

 So, does ExxonMobil know something that the whole of the industry doesn´t?

As part of the rollout, two new partnerships were shared. ExxonMobil said it is working with a carbonate fuel cell developer called FuelCell Energy and a direct-air-capture firm called Global Thermostat.  

ExxonMobil also announced plans to increase its production of hydrogen, which has some synergies with CCS operations. The oil company produced about 1.3 Mt of clean-burning hydrogen last year, according to company reports.

Might it be related to a possible mega merger with Chevron?