Exxon in the business of making money - Darren Woods

Exxon in the business of making money – Darren Woods

Apr 12, 2024 ExxonMobil, News, Oil & Gas

ExxonMobil’s Chief Executive Officer (CEO), Darren Woods

…not enough incentives to invest in renewables

Kaieteur News – ExxonMobil’s Chief Executive Officer (CEO) Darren Woods has defended his company’s hardline stance against shareholders who over the past 10 years have submitted more than 140 motions calling on the company to cut its emissions, as activists not interested in the ideology of the business, that is making money.

Woods gave his position during a recent interview with Fortune Magazine’s in which he said over half of the submissions were from just three activist groups, “they don’t have an economic interest in the company.” He instead, lambasted the United States, Securities Exchange Council for permitting the motions. Qualifying this position, Woods told the interviewer while the company prides itself on giving a voice to, and catering for its real investors that want to see a return (profits), “we don’t feel a responsibility, for activists that hijack that process and frankly abuse it that advance and ideolog that is inconsistent with the ideology of the company.”

Their strategy, he said “is to get us to stop selling oil and gas, that’s what we do as a business.”

As it relates to Climate Change and the company’s role, Woods spoke to investments that the company has been making to do its part such as Carbon Capture technology and the extraction of lithium, a key component in the use of batteries for Electric Vehicles. In fact, Woods was adamant that renewable energy such as wind, solar and EVs have a role to play, but insists the existing technology is not enough to meet the net zero objectives. He was adamant, “we waited too long as a society and we’re not investing enough, today’s technology will not solve this problem.”

According to Woods, this was the “dirty secret that nobody is talking about, is how much it’s going to cost.” To this end he was adamant that governments around the world need to be franker with their constituencies saying, “they need to be aware of it and people need to know the price; governments got to get that to their constituency.”

Further defending Exxon’s importance in the industry, Woods told the interviewers that the incentives were simply not in place to warrant the investments. To this end, he disclosed that ExxonMobil as a company has the technology to refine fuel with lower carbon content, but argued that it would end up having to be sold at a higher price. “When are people going to be willing to pay for carbon reduction; we can make fuel with less carbon but people won’t pay for it.”

Woods said ExxonMobil is aware of the challenges posed by Climate Change and the need to reduce emissions, the company was looking to invest in new technology. Since, the present technology available, are simply not going to meet required demands in order to meet the objectives set for net zero emissions. According to Woods, compounding the situation is the fact that while the world is not on that path, the policies in place don’t incentive success, for the investment in existing renewable by Exxon such as wind and solar. “As we look at the transition, a lower emissions world, the question we asked ourselves is how we can bring our capability to solve that problem” according to Woods. “When you look at levels of investment, talking about wind and solar that is already established…we don’t bring capability to that space other than a cheque; it’s not an appropriate use of ExxonMobil technology,” according to Woods, hence his argument greater focus on decarbonizing through, wind and solar won’t be effective in meeting needs.” To this end, he was adamant, “if you are going to drive investment to move the needle, it will cost a money, building a business on govt. subsidy is not a long-term strategy,” in response to further investment by the company in its efforts in meeting the net zero targets.

According to Woods, “you have to put a value on decarbonizing.”

business, Darren Woods, Exxon, hardline, money

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