By 2050, Exxon Intends to Reduce Emissions from its Operations to Zero but Won't Quit Fossil Fuels Anytime in the Foreseeable Future

Exxon Mobil Corp (XOM.N) committed to reducing net carbon emissions from its global operations to zero by 2050, a move in the direction of competitors aiming to reduce their carbon footprints. As an investor and public scrutiny in the oil segment, the company plans to decrease or eliminate greenhouse-gas emissions from its activities to achieve net-zero by 2050 to address climate change caused by its products has risen.

On Tuesday, the U.S. oil giant said it has emission-reduction plans for some critical facilities and holdings and can successfully manage the worldwide move toward renewable energy sources.

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Exxon's aim concentrates on operations instead of emissions from the refined oil CL00, natural gas NG00, and gasoline RB00 it produces. Moreover, it does not apply to oil fields or other assets in which it has an investment but does not operate. The oil company believes it can meet this target by implementing energy-saving measures, minimising methane leaks, modernising equipment, and eliminating natural gas venting and flaring.

The CEO and chairman Darren Woods commented that to meet the pace of the energy shift, they will adapt investments between their existing low-cost portfolio and future lower-emission business prospects to produce shareholder value.

Exxon said in December that it will achieve net-zero emissions in the Permian Basin in Texas and New Mexico by 2030, which is one of the organisation's most significant operations.

Environmental and sustainable-investment groups and others have criticised oil firms for not undertaking more to reduce greenhouse gas emissions from their supplies. Consumer-generated emissions are referred to as "scope 3" emissions, and firms like Exxon shouldn't get top Environmental, Social and Governance (ESG) scores in the conventional sense.

Doug Heske, the founder of Newday Impact Investing, a platform that assists institutional investors in building long-term portfolios, stated that it's incredibly vital to connect with giant fossil fuel corporations. However, he added that they are expected to be around for a long time and do better at what they are doing. Furthermore, Exxon, which has been criticised in recent years for not following the company’s commitments things that the company commits, is now subjected to new board directors attempting to bring a change finally.

Exxon lost three spots on its board of directors to activist hedge fund Engine No. 1 at its annual shareholder meeting in May. Some view it as moving the business closer to sustainable energy. Others believed that this distinct influence was all talk and no action.

Exxon was the last big oil company to make a significant emission commitment. Both European companies, BP PLc and Royal Dutch Shell RDS.A, made similar statements in 2020. In October, Chevron Corp. CVX, based in the United States, announced that it had set a net-zero objective and had undertaken technology-based investments to scale carbon-capture abilities.

Scientists think that limiting global warming to 1.5 degrees Celsius will assist in mitigating the worst consequences of climate change. Coal, oil, and natural gas account for a little over 80 percent of global energy production. Yet, eighty-nine percent of human-caused CO2 emissions come from burning them.

Exxon's shares have increased by 50 percent this year compared to the last year as the economy recovered from the worst COVID-19 setback and industry and households upped their energy use.

According to the impartial Rhodium Group research, U.S. greenhouse gas emissions increased dramatically from a COVID-19 low in 2021, outpacing the whole economy.

According to a study published earlier this month, as industrial activity increased and more freight moved in 2021 than in 2020, energy analysts projected a reduction in global warming emissions. Nonetheless, the increase in pollutants exceeded projections.

Rhodium Group forecasts that nationwide Greenhouse gas emissions climbed to 6.2 percent in 2021 as compared to 2020; however, emissions remained 5 percent below 2019 levels, based on preliminary data.