Exxon Mobil reveals full scope of petroleum product emissions
For the first time, oil giant Exxon Mobil Corp. has reported the full emissions data on customers’ use of its fuels and other products after coming under pressure from its activist investors.
In the company’s Energy and Carbon Summary released on Tuesday, the company’s so-called Scope 3 emissions from its product sales in 2019 amounted to 730 million metric tons of carbon dioxide. This is about the same output as the whole of Canada and the highest compared to rival oil companies.
The data comes after recent pressure from activist investors regarding Exxon’s poor shareholder returns and environmental record.
In the report, Exxon Mobil said that more focus should go on Scope 1 and 2 emissions, which are within its direct control, rather than on product usage, which depends on customer demand.
“Scope 3 emissions do not provide meaningful insight into the company’s emission-reduction performance and could be misleading in some respects,” the company said.
On the other hand, other Western oil companies such as Royal Dutch Shell Plc and BP Plc are targeting emissions cuts that cover Scope 3 figures.
In December 2020, other major investors such as Alliance Bernstein, Wellington Management and California State Teachers’ Retirement System have also joined in the call for Exxon and the oil and gas industry to be more transparent and publish more forward-looking emissions data.
Although Exxon said last month that it would set new, more ambitious targets to reduce emissions per barrel of crude, the company didn’t make any pledges related to reducing its absolute level of pollution.
In October, Bloomberg News reported that internal documents showed the company’s 2018 plan to boost oil and gas production was projected to cause a surge in greenhouse gas emissions equivalent to the entire output of Greece. This was however hindered by the pandemic, forcing Exxon to cut capital spending and scale back its growth ambitions. The oil giant said however that the story was misleading because the documents didn’t include additional emissions mitigation efforts that would have been implemented over time.
In 2019, Exxon’s Scope 1 and 2 emissions fell 3.2% to 120 million tons of carbon dioxide equivalent, the lowest since at least 2010.
Exxon Mobil said in the report that despite energy-transition scenarios that show fossil fuel usage decreasing over time, its oil and gas reserves “face little risk from declining demand”. The company said this is because “substantial majority” of its proved resources will be produced over the next 20 years, when they are supported by “ample demand”.
Source: Bloomberg News