Multinational oil and gas corporation, ExxonMobil says it plans to increase cash flow by $14 billion from 2023 to 2027.
The company stated this in a corporate plan update released on Wednesday, December 6. This growth will be facilitated by the ongoing efforts to reduce operational costs and enhance the company’s business mix.
ExxonMobil also said that it aims to optimize its business mix by expanding production from low-cost assets while increasing the sales of high-value products like performance chemicals, low-emission fuels, and advanced lubricants.
This strategy aligns with their commitment to providing energy globally while simultaneously developing solutions to reduce emissions in challenging sectors of the economy.
The company foresees a significant increase in upstream (oil and gas production) earnings by 2027 compared to 2019. This growth will stem from investments in profitable projects that have a low cost of supply.
Around 90% of their planned capital investments in new oil and gas production over the next five years are anticipated to yield returns of more than 10% at a Brent price of $35 per barrel.
ExxonMobil also said in its statement that it intends to achieve an additional $6 billion in structural cost reductions by the end of 2027, bringing the total savings to about $15 billion compared to 2019.
They plan to achieve this by streamlining various operational aspects such as maintenance, supply chain, financial reporting, and trading, among others.
In October 2023, the International Energy Agency (IEA) highlighted in its 2023 World Energy Investment report that major oil, gas, and coal companies are projected to boost investments in unabated fossil fuel supply by over 6% in 2023, totalling approximately $950 billion.
The Nigerian context
In September 2023, President Bola Ahmed Tinubu met with a delegation of ExxonMobil and tried to woo the energy giant to invest in Nigeria’s oil and gas business, stating that the country is now ready for business under his leadership.
Meanwhile, ExxonMobil’s President of Global Upstream Operations, Liam Mallon, conveyed his recognition of President Tinubu’s steadfast dedication to Nigeria’s interests. He assured a notable surge in production, committing to delivering almost 40,000 barrels per day (bpd) as part of an upcoming investment phase in Nigeria.
Addressing President Tinubu, Mallon highlighted the production growth and emphasized their dedicated work on expanding deepwater production.
Expressing gratitude for Tinubu’s leadership, Mallon pledged reciprocal efforts, emphasizing the opportune moment for progress.