HOUSTON – Darren W. Woods seldom makes headlines despite being the executive director of Exxon Mobil, the oil company that some people consider top environmental villains and others consider it a major engine of the US economy.
Few have taken it seriously, or even noticed, that he is beginning to make promises to respond to climate change, which is at least a rhetorical break, if not a substantial one, with his predecessors.
“What society is right to demand is affordable, reliable energy that does not have the emissions associated with today’s energy systems,” he said Tuesday. “We are working on this development.”
While this may seem like a cautious statement, Mr. Woods, a quiet electrical engineer from Wichita, Kan., Is changing the tone of the company he acquired over four years ago significantly. The bragging rights used by its predecessors in Texas, one of whom openly denied climate change concerns, has grown into something vaguely philosophical.
In an interview that was meant to raise the curtain on an annual presentation that executives will offer financial analysts and investors on Wednesday, Woods, 56, got poetic about the history of technology and the energy industry, and even suggested that there were similarities between him gives emission reduction plans and President Biden’s efforts to combat climate change. He went so far as to promise that Exxon would try to set a goal of not emitting more greenhouse gases than it removes from the atmosphere, though he said it was still difficult to say when that might happen.
“We support that ambition and our goal is to help society achieve it,” said Woods. “To be honest, the recognition of the challenge continues to grow. It’s an evolving conversation that I find very helpful in considering what needs to happen. “
Under pressure from activist investors, Exxon announced this week that it has added two new directors to its board with no prior commitment to fossil fuels. The company recently announced it would create a new company that will capture carbon dioxide from industrial facilities and bury it deep in the ground. It also recently invested in Global Thermostat, a company that aims to suck carbon dioxide out of the air.
Of course, many people are deeply skeptical of the company’s plans and motives. Unlike executives at European oil companies, Mr. Woods does not cut investments in oil and gas to spend money on wind and solar power. He refrained from commenting on BP’s promise made last year to bring net emissions to zero by 2050.
“Unlike their major oil competitors, who have begun to take action against climate change, Woods and Exxon Mobil continue to live in a fairytale world of inactivity while California burns and Texas freezes,” said Peter Krull, chief executive officer of Earth Equity Advisors. a study and investment firm specializing in sustainability.
After spending nearly three decades with a company traditionally known for its island location, rigid culture, and public indifference to global warming, Mr Woods suggested that he be ready to steer it on a different course if also gradually.
With Exxon’s stock price still lower than it was a decade ago, many investors have asked for no less.
“My interactions with investors reflect broader trends in society,” said Woods.
The four years that Mr. Woods spent as managing director have been a difficult time for the industry. Oil and gas prices have risen and fallen several times in recent years. And last year, demand for petroleum products collapsed when the coronavirus pandemic hit. Exxon lost $ 22.4 billion in 2020, much of it from amortization of assets the company acquired at high prices prior to being acquired by Mr. Woods.
But oil and gas prices have rebounded in the past few weeks, and Exxon and its stocks are doing better. Mr Woods said the revenue was flowing back in, which allowed the company to run down debt and pay for future projects. The company’s dividend, which it has been raising every year for nearly four decades, now seems safe from cuts.
What Exxon doesn’t do is spend much of its assets on companies or ideas that aim to greatly reduce emissions. Only $ 3 billion will be spent on carbon capture from industrial facilities by 2025 – a small fraction of the planned $ 16-19 billion Expenditure on oil exploration and capital projects this year.
Mr Woods said he would seek more change by researching breakthrough technologies. However, many of them still have years or decades to have a major impact on emissions.
“Until we know the way to go and what will be required and what the solutions are, it’s hard to know,” he said. “What we can do is make a commitment to find out, and once we find the answers, you will see that we are committed and we are actually on our way to net zero.”
While Exxon invests in energy efficiency projects, biofuels and hydrogen, Mr. Woods was particularly enthusiastic about his company’s 20 carbon capture and storage projects. Although the technology is not yet widely used because it is very expensive, Woods and Exxon scientists argue that it could play an important role in reducing emissions from cement and steel making and other industrial processes that renewable energy does not can be operated easily.
“The capture and storage of carbon will be required,” he said.
He even suggested that “there certainly is the potential” that Exxon’s carbon capture and storage program might fit precisely with Mr. Biden’s policies and goals.
“Political support and the right legal framework to support these investments are needed and will be important,” said Woods. “We would like to start this conversation with you. You need an investment permit. You need pipeline systems, laws, regulatory reforms and legal frameworks for storing CO2. “
Mr. Biden has expressed his support for carbon capture and sequestration. It is an environmental policy that Republicans in Congress could support, although many Liberal Democrats are not interested in it because they see it as an extension of fossil fuel use.
Many climate researchers are deeply skeptical that the technology can be used to the extent necessary to significantly reduce emissions. Some energy managers share this skepticism.
Charif Souki, the CEO of Tellurian, a liquefied natural gas company, said carbon capture was one of many potentially promising technologies for combating climate change. But he added, “There is no efficient way of doing this on the scale it takes to do what we need to do.”
But Mr. Woods said he was optimistic about the path Exxon had chosen. “It is very difficult to predict when a breakthrough will occur,” he said, “but when you look back in time, it is consistent.”