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introduced on Monday that it will create a brand new enterprise to deal with commercializing expertise to cut back carbon emissions. The corporate has been below strain from activist buyers to shift its enterprise towards extra climate-friendly initiatives.
The brand new enterprise will focus at first on carbon seize and storage, an space the place Exxon (ticker: XOM) has been energetic for many years. Carbon seize entails capturing carbon dioxide as a substitute of permitting it to be launched into the environment, after which injecting it deep into rocks, the place it’s anticipated to remain completely. The expertise has been cited by a United Nations panel as one solution to sluggish the influence of local weather change.
Exxon has been engaged on the expertise for greater than 30 years and says it “was the primary firm to seize greater than 120 million metric tons of CO2, which is equal to the emissions of greater than 25 million vehicles for one 12 months.”
The corporate additionally stated within the launch that it will spend $3 billion via 2025 on “decrease emission vitality options.” Exxon says it has put greater than $10 billion into carbon-reduction analysis and improvement and deployment since 2000.
However Exxon has been criticized for being slower than different oil giants to shift its enterprise mannequin towards renewables.
(BP), for example, stated final 12 months it deliberate to spend $3 billion to $4 billion a 12 months on renewable vitality by 2025.
Requested in a current interview with Barron’s why Exxon wasn’t investing as rapidly as BP, Exxon govt Neil Chapman famous that the corporate had made low-carbon investments, whereas saying “we see the demand for crude oil or gasoline, for refined merchandise and petrochemicals, being there for a very long time into the longer term.”
Exxon is dealing with an activist marketing campaign from funding agency Engine No. 1, which is difficult the corporate on its low-carbon dedication. Engine No. 1 has nominated 4 members to Exxon’s board. Different buyers, together with the Church of England, have been pushing Exxon on this challenge, too.
Exxon has lengthy been an vitality innovator however hasn’t at all times capitalized on its innovations. In reality, Exxon was a key developer of lithium ion battery expertise, which powers electrical autos which have been consuming into Exxon’s core enterprise. The corporate, nevertheless, isn’t making a lot cash on lithium batteries, at the same time as that enterprise has grow to be one of many fastest-growing areas of vitality manufacturing.
Requested if it wished it had commercialized that expertise sooner, a spokesperson wrote that lithium batteries are “one a part of the vitality transition. Exxon Mobil Low Carbon Options shall be centered on including new applied sciences as they mature to commercialization.”
Write to Avi Salzman at email@example.com