Shares of Exxon Mobil Corp (NYSE: XOM) are up 2.0% on Wednesday after the oil giant said its 2019’s earnings and cash flow will be doubled by 2027.
Exxon is spending big on cutting emissions
Shareholders particularly cheered today’s announcement as Exxon reiterated its commitment to a low-carbon future. The American multinational said it will spend $15 billion through 2027 on cutting emissions.
In total, the Texas-based company said it will peg its annual capital spending at $25 billion during this period – a sharp increase from $16 billion to $19 billion range for 2021. Before the pandemic, however, Exxon wanted to spend over $30 billion per year.
The new spending plan, the oil and gas firm said, offers “flexibility to adjust to adverse market conditions”. The announcement comes more than a month after Exxon said it will repurchase up to $10 billion worth of its stock through 2023 and raised its dividend after more than two years.
Exxon is focusing on premium assets
CEO Darren Woods is confident in the company’s new upstream investments, almost all of which, he forecasts, will produce over 10% return even if oil prices tumble to under $35 a barrel.
The restored strength of our balance sheet and improved financial outlook support accelerating investment in our industry-advantaged, high-return projects, and a growing list of financially accretive lower-emission business opportunities to create shareholder value.
The WTI Crude has been on the rise since late August, helping Exxon report market-beating results for its fiscal third quarter. It now stands at about $67 on Wednesday after climbing over $85 in October.
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