LNG

ExxonMobil Corp. has told investors about the latest schedules for its various liquefied natural gas projects worldwide including a delay in the “mechanical completion” of the Golden Pass LNG export plant on the Gulf Coast and with progress promised in 2024 on Mozambique LNG and on the expansion joint venture in Papua New Guinea.

Chevron Corp., the US major with liquefied natural gas projects in nations such as Australia and supplying LNG cargoes to both the Asia-Pacific and the Atlantic Basin, has authorised a share buy-back of $75 billion to enable investors to benefit from increased profits.

The statement on the buy-back from San Ramon, California-based Chevron came ahead of fourth-quarter earnings due on January 27.

A share buy-back reduces the number of shares outstanding and increases the earnings per share value of outstanding stock while under-scoring the financial efficiency of the company.

The Chevron board also declared a quarterly dividend of $1.51 per share, an increase of $0.09 cents per share, or 6 percent.

“This increase puts Chevron on track to make 2023 the 36th consecutive year with an increase in annual dividend pay-out per share,” it added.

Chevron, led by Chairman and Chief Executive Mike Wirth, stated that its previous share repurchase authorization of $25Bln, which has been in place since January 2019, will terminate at the end of March.

The company said that under new buy-back programme it would also repurchase the company’s common stock from time to time in the open market, by block purchases, in privately negotiated transactions or in other ways determined by the company.

“The timing of the repurchases and the actual amount repurchased will depend on a variety of factors, including the market price of the company's shares, general market and economic conditions and other factors,” it added.

In addition to its global oil and gas industry presence and its strong position in US domestic production areas such as the Permian Basin, Chevron also operates three world-class LNG exports terminals.

LNG projects

The company is the operator of the Gorgon and Wheatstone LNG facilities in Western Australia as well as Angola LNG in southwest Africa and also has a strong position in Eastern Mediterranean natural gas markets after the 2020 acquisition of Houston-based Noble Energy.

According to analyst estimates, Chevron is expected to report a doubling of 2022 profits to around $37.2Bln and is seen spending about $17Bln on new oil and gas projects this year, up $2Bln from the previous year.

Other energy majors such as ExxonMobil, Shell, BP and TotalEnergies are also expected to report very high annual profits that will be the subject of share buy-backs for their loyal shareholders while also attracting criticism led by the anti-capitalist lobby.

Analysts noted that governments have also been targeting energy companies with actual or threats of “windfall” taxes to try and raise revenues to cope with energy security issues caused by their own misguided strategies.

They added that these have included over-emphasizing intermittent renewable projects and at the same time putting regulatory barriers up for hydrocarbon projects that are needed when renewables fail.

This has been done even as oil and gas companies have been the biggest creators of technology and projects to reduce excess carbon emissions and have tasked themselves with keeping economies going for the next 30 years with energy supplies forecast to be much less less than at present.

ExxonMobil said upstream earnings potential was expected to double by 2027 from three years ago with more than 70 percent of capital investments being deployed in strategic developments in LNG projects around the world and in the US Permian Basin as well as in the South American nations of Guyana and Brazil.

The Irving, Texas-based major said that by 2027, upstream production is expected to grow by 500,000 oil-equivalent barrels per day to 4.2 million oil-equivalent barrels per day with more than 50 percent of the total to come from these key growth areas.

“Around 90 percent of upstream investments that bring on new oil and flowing gas production are expected to have returns greater than 10 percent at prices less than or equal to $35 per barrel, while also reducing upstream operated greenhouse-gas emissions intensity by 40-50 percent through 2030, compared to 2016 levels,” said ExxonMobil.

Corporate plan

The details came in ExxonMobil’s just issued corporate plan for the next five years, with a sizeable increase in investments aimed at emission reductions.

ExxonMobil’s priority LNG production areas are at the Golden Pass project in Texas, in the southeast African nation of Mozambique, in Papua New Guinea and in Qatar where its main partner is QatarEnergy.

The corporate plan through 2027 maintains annual capital expenditures at $20 billion to $25 billion, while growing lower-emissions investments to about $17Bln.

ExxonMobil forecast that earnings and cash flow growth was expected to double by 2027 compared with 2019.

There would also be share-repurchase program expanded up to $50Bln through 2024, including $15Bln in 2022.

“Our five-year plan is expected to drive leading business outcomes and is a continuation of the path that has delivered industry-leading results in 2022,” said Darren Woods, Chairman and Chief Executive.

“We view our success as an ‘and’ equation, one in which we can produce the energy and products society needs - and - be a leader in reducing greenhouse-gas emissions from our own operations and also those from other companies,” added Woods.

The corporate plan we’re laying out today reflects that view, and the results we’ve seen to date demonstrate that we’re on the right course.”

The company also remained on track to deliver a total of about $9 billion in structural cost reductions by year-end 2023 versus 2019.

In the Permian, the company said it was on track with its goal to reach net-zero Scope 1 and 2 emissions from its operated unconventional assets by 2030.

“We’re aggressively working to reduce greenhouse gas emissions from our operations, and our 2030 emission-reduction plans are on track to achieve a 40-50 percent reduction in upstream greenhouse-gas intensity, compared to 2016 levels,” added Woods.

“We will continue to advocate for clear and consistent government policies that accelerate progress to a lower-emissions future. At the same time, we’ll continue to work to provide solutions that can help customers in other industries reduce their emissions, especially in higher-emitting sectors of the economy like manufacturing, transportation and power generation,” stated the CEO.

PetroChina, the Hong Kong-listed arm of China National Petroleum Corp., reported a more than 60 percent drop in nine-month profits as pipeline natural gas and LNG imports continued to be loss-making.

JERA Co Inc., the largest Japanese LNG buyer, said it signed an accord with ExxonMobil and the city government of the Vietnamese port of Haiphong to work together on a potential integrated LNG-to-Power project for the Port.