Exxon Is Capturing Dollars, Not Just Carbon
The biggest US oil producer has the opportunity to tap government subsidies for a new and risky business while also lifting a shadow from its stock price.
Changing lanes.
Photographer: Joe Raedle/Getty Images North AmericaCarbon capture and sequestration is all about taking a cost and burying it. For the likes of Exxon Mobil Corp., it can be better thought of as a means of releasing trapped dollars.
Exxon has just announced a deal to capture and store emissions from a Louisiana steel mill operated by Nucor Inc. It is the third such deal struck with third-party industrial clients on the Gulf Coast, targeting an aggregate 5 million tons of emissions per year. At a recent analyst presentation, Exxon outlined plans to invest $7 billion through 2027 in its newly established Low Carbon Solutions unit’s efforts to help other companies reduce emissions (it is investing another $10 billion in cutting its own). Chief Executive Officer Darren Woods stresses that this business, like the rest of Exxon’s sprawling portfolio, must compete for capital on the basis of the returns it generates.