ExxonMobil's 5-Year Capital Plan Highlights Upstream, Low-Carbon Efforts

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Researched by Industrial Info Resources (Sugar Land, Texas)--ExxonMobil Corporation (NYSE:XOM) (Irving, Texas) last week announced between $20 billion and $25 billion in capital investments per year through 2027, including a total $17 billion over that period on lower-emissions efforts--an increase of about 15% from last year's ambitions. Industrial Info is tracking more than $71 billion in active ExxonMobil projects worldwide, including more than $25 billion in North America.

The company expects 2022 capital expenditures (capex) to be about $22 billion, with 2023 capex in the range of $23 billion to $25 billion. The latter is focused on helping to "increase supply to meet global demand," according to a related press release.

But in prepared remarks, Senior Vice President and Chief Financial Officer Kathryn Mikells offered a caveat, saying: "We also retain flexibility within the portfolio to adjust our capital expenditures to changing market conditions, as well as the pace of the energy transition, based on signposts such as technological developments, permits and passage of favorable policy."

Regardless, more than 70% of upstream investments in the capital allocation through 2027 is expected to be "deployed in strategic developments in the U.S. Permian Basin, Guyana, Brazil and LNG projects around the world," the company said. ExxonMobil expects upstream production to grow by 500,000 oil-equivalent barrels per day by 2027 to 4.2 million oil-equivalent barrels, with more than 50% of the total to come from those key areas. Near-term upstream investments are estimated to keep production at about 3.7 million oil-equivalent barrels per day, the company said.

Among ExxonMobil's upstream projects is a $12 billion expansion of the Point Thomson Oil & Gas Production Unit in Prudhoe Bay, Alaska. The project entails expanding the central pad at an initial production system site to accommodate a 57,000-barrel-per-day (BBL/d) condensate production increase and a gas production increase of between 560 million and 1.1 billion cubic feet per day. The project is in the cost analysis phase, with the kickoff expected in March 2023. Completion is planned for 2026. A supporting drilling program, planned to kick off later in 2023, involves drilling four to seven vertical and horizontal oil and gas production wells, among other work. Subscribers to Industrial Info's Global Market Intelligence (GMI) Production Project Database can see project reports on the Point Thomson expansion and drilling program.

In Guyana, the company said it expects gross production to reach more than 850,000 BBL/d by 2027, an increase of 130% to date. A consortium led by ExxonMobil (through its subsidiary Esso Exploration and Production Guyana) operates Guyana's Stabroek oil block, which covers 6.6 million acres. The group is planning for the proposed $1.8 billion construction of a 250,000-BBL/d floating production, storage and offloading (FPSO) unit at the block's Yellowtail field. Kickoff is expected in August with operations starting in the fourth quarter of 2025. The project is part of a larger development plan for Yellowtail. Subscribers can click here for the FPSO project report and here a list of projects for the development plan.

Lower-Carbon Solutions
The company said the increase in lower-emission investments compared with 2022's projection "reflects our growing portfolio of attractive opportunities and the increased support that we are seeing from private and public investment, partnership opportunities, and government policies. It further demonstrates our resolve to reduce our own emissions, and the confidence that we have to be a solutions provider that helps others reduce their emissions through carbon capture and storage, hydrogen, and lower-emission fuels...."

Equipment studies are underway for a proposed $5 billion blue hydrogen and carbon capture and storage addition at its olefins complex in Baytown, Texas. The additions would be capable of producing 1 billion cubic feet per day of blue hydrogen and storing up to 10 million tons of carbon dioxide (CO2) per year, respectively. Subscribers to the GMI Chemical Processing Project Database can click here for the project report.

The U.S. Department of Energy estimates the Gulf Coast could store as much as 500 billion metric tons of CO2 using CCS.

In its third-quarter earnings review, ExxonMobil reported results that exceeded its second-quarter earnings and announced the "largest-of-its-kind commercial agreement to capture and permanently store up to 2 million metric tons of CO2 emissions per year." For more information, see Industrial Info's November 3, 2022, article - Big Oil's Profits Soar in Third Quarter.

The five-year capital plan also allocates spending for projects in ExxonMobil's Product Solutions business: "These growth plans are focused on high-return projects that are anticipated to double volumes of performance chemicals, lower-emission fuels, and high-value lubricants," the company said.

These include two unit additions worth a combined $2 billion at the Baytown Olefins Plant in Texas, both of which kicked off in 2019 and are expected to be completed in early 2023. One unit would produce about 400,000 tons per year of a copolymer of propylene and ethylene, which is marketed under the name Vistamaxx; the other would produce about 350,000 tons per year of linear alpha olefins (LAO). Subscribers can see reports for the Vistamaxx and LAO projects.

Another oil and gas major, Chevron Corporation (NYSE:CVX) (San Ramon, California), recently announced it plans to increase organic capital expenditures for 2023 by 25% from 2022's spend--also buoyed by upstream and low-carbon efforts. For more information, see December 9, 2022, article - Chevron Hikes Spending 25% for 2023, Led by U.S. Upstream.

Subscribers to Industrial Info's GMI Project Database can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.

Click here for a full list of reports for active projects from ExxonMobil globally.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).