November 4, 2021 Read More →

ExxonMobil acknowledges potential investment risks of fossil projects

Reuters:

Exxon Mobil Corp (XOM.N) on Wednesday said for the first time in a securities filing that some of its oil and gas properties may face impairment due to climate change.

The largest U.S. oil company’s board will test assets for climate impairments “in the context of overall enterprise risk” during the annual asset review by its board of directors. “Certain assets could be at risk for impairment,” it said.

Exxon’s 12-member board was overhauled in May with three new directors in a proxy battle that weighed heavily on the company’s past failure to address climate change. Hedge fund Engine No. 1 was successful in convincing enough shareholders a new board could improve performance and rethink the energy transition strategy. [nL2N2ND0SH]

The company for years has acknowledged risks to investment returns, demand and costs associated with climate change, and won a 2019 court fight against New York state’s Attorney General who alleged Exxon’s assessments failed to consider potential impairments for climate-related risks, a spokesperson said.

Directors will analyze factors including future energy supply, regulation, government policies and greenhouse gas restrictions, the company said in the regulatory filing.

[Sabrina Valle]

More: Exxon warns some assets may be at risk for impairment due to climate change

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