By CATHY BUSSEWITZ, AP News.
By CATHY BUSSEWITZ AP Business Writer
NEW YORK (AP) — Exxon Mobil swung back to a profit and topped expectations during the second quarter as demand for fuel recovered from lows reached earlier in the pandemic.
Exxon’s profits reached $4.69 billion, or $1.10 per share, after the company reported a loss last year during mass shutdowns intended to limit the spread of the virus.
On top of volatile energy prices, there are also new pressures internally as some investors pressure major producers of crude and natural gas to shift to cleaner energy sources in a bid to slow climate change.
Exxon shareholders recently shook up the board, voting to replace three of the company’s 12 board members with directors they said were better equipped to guide the oil giant through a transition to cleaner energy.
In a conference call with investors Friday, CEO Darren Woods began his remarks by acknowledging changes within Exxon, saying the company has been meeting with the new directors, and many of his remarks throughout the call were focused on climate-related initiatives.
“We’re stepping up and accelerating efforts to ensure the company plays a meaningful role in the energy transition,” Woods said. “Our plans will reflect the continued development and deployment of needed technologies.”
Woods touted Exxon’s plans to expand its carbon capture and storage facility in Wyoming and its work developing lower-emission fuels. He also said the company also has been reducing methane emissions and using flyover technology to detect methane leaks in the Permian Basin.
Exxon also signed on to invest in a carbon capture and storage project in Scotland which aims to capture and store 5 million to 6 million metric tons of carbon dioxide annually by 2030. It would take many such projects to make a dent in emissions generated by the oil and gas industries.
Last year, Exxon alone emitted 112 million metric tons of carbon dioxide. That doesn’t count the emissions generated when its customers use its products.
Nevertheless, the plan has strong points and “you’ve got to start somewhere,” said Peter McNally, global sector lead at Third Bridge. “The North Sea, in general, is a good place to do carbon capture. You have favorable geology and a government that’s behind it.”
Exxon’s profits in the second quarter easily topped the $1.02 per share that Wall Street was looking for, according to a survey by Zacks Investment Research.
Revenue at the Irving company was $67.74 billion, roughly double last year during the same period, and also better than the expectations of $63.73 billion from industry analysts.
Exxon produced the equivalent of 3.6 million barrels of oil per day in the second quarter, down 2% from the second quarter of 2020 due to increased maintenance activity, the company said. In the Permian Basin, Exxon’s oil production rose to 400,000 barrels per day, up 34% from the same quarter last year.
Its chemical business delivered earnings of $2.3 billion, its best quarter in the company’s history.
A year ago, the oil and gas industry was in the grips of a massive downturn when the global pandemic halted travel and demand for fuel cratered, forcing major oil companies including Exxon to slash budgets and staff.
“Reflecting back on the past half year, we’re pleased with the results the organization’s hard work has delivered in a recovery market,” Woods said. “We’ve made a lot of progress.”
This story has been corrected to show that Exxon produced 3.6 million barrels of oil per day in the second quarter, not the first quarter.