Exxon Mobil Withdraws From Spend Increase Plan, Preparing To Reduce Book Value Of Assets

Exxon Mobil Corp. Scraps plan to increase spending to boost oil and gas production by 2025, and prepares to reduce the book value of its assets to $ 20 billion, as ailing company reassesses its next decade.

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XOMEXXON MOBIL CORPORATION

The Texas oil giant, which has lost more than $ 2.3 billion in the first three quarters of this year after the coronavirus ravaged demand for fossil fuels, on Monday released reduced spending forecasts for the next five years. He now plans to spend $ 19 billion or less next year and $ 20 to $ 25 billion a year between 2022 and 2025. He previously planned to spend more than $ 30 billion a year on capital spending until in 2025.

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Exxon has also said it will stop investing in some natural gas assets and wired a massive depreciation of between $ 17 billion and $ 20 billion in the fourth quarter.

The cuts are a course correction for chief executive Darren Woods, who laid out a plan in 2018 to spend $ 230 billion to double profits and pump an additional million barrels of oil and gas a day by the middle. of the next decade. This plan proved to be inappropriate, especially after the pandemic caused oil prices to plummet this spring.

Exxon said on Monday it would now double its profits by 2027, but has not released any specific targets to increase its oil and gas production. Exxon executives have said in recent months that the company is reassessing its production targets.

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Mr Woods said in a statement the company is focused on improving its earnings and strengthening its balance sheet to manage future price fluctuations and maintain its dividend, which costs Exxon around $ 15 billion a year.

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