ExxonMobil Corp., the largest US oil company and leading LNG producer and a partner of Qatar in many global projects, will have its first-quarter 2024 earnings impacted by price shifts while also completing the sale of its stake in the Adriatic LNG import terminal offshore Italy and pursuing the huge takeover of Pioneer Natural Resources in the US.
ExxonMobil estimated that large decreases in oil, gas and fuel prices would deliver a first-quarter operating profit of between $6.65 billion and $11.6Bln for the first three months of the year compared with $7.63Bln in the fourth quarter of 2023.
ExxonMobil filed its first-quarter earnings indicator with the US Securities and Exchange Commission.
The ExxonMobil earnings total would be well below the prior-year first quarter when natural gas prices were much higher.
Weaker prices
Overall weaker oil and gas prices alone were expected to reduce ExxonMobil’s profits by about $600 million compared with the fourth quarter of 2023.
The company also said fuel derivatives adversely affected gains in gasoline and diesel margins, costing it about $1.1Bln compared with the fourth quarter.
Refining maintenance costs also increased during the fourth-quarter and the first quarter of the 2024.
“To give perspective regarding market and planned factors affecting 1Q 2024 results, we are providing the summary of items management believes will impact 1Q 2024 results relative to 4Q 2023 results,” said the company.
“These factors are generally limited to significant planned activities, market dynamics and seasonal demand patterns,” the filing explained.
“This is only intended to provide information regarding current estimates of these factors,” said the filing.
“It is not comprehensive of all changes between 4Q 2023 and 1Q 2024 results and is not an estimate of 1Q 2024 earnings for the Corporation,” ExxonMobil stated.
Adriatic LNG sale
Dutch energy storage group VTTI has also acquired the 70 percent stake previously held by ExxonMobil in Italy's biggest LNG terminal, the gravity-based structure facility Adriatic LNG, and the balance of 30 percent is now owned by Italian gas grid and terminals operator SNAM.
ExxonMobil had stated in March 2023 that it was considering selling its stake of just over 70 percent in Adriatic LNG as a non-core asset.
The Adriatic terminal is located 15 kilometres (9.3 miles) off the Veneto coastline of Italy and has been on line since 2009.
It includes two LNG storage tanks, each with a capacity of 125,000 cubic metres.
The operating company is called Terminale GNL Adriatico. ExxonMobil had held its majority stake while a QatarEnergy unit, Qatar Terminal Company, owned 22 percent and SNAM had held 7.3 percent.
ExxonMobil is also pursuing the all-stock deal to acquire Texas-based Pioneer Natural Resources for $59.5Bln.
The combination gives ExxonMobil a stronger position in the Permian Basin in Western Texas and New Mexico.
ExxonMobil is expected to report first-quarter earnings on April 26.
