ExxonMobil is an American oil and gas company headquartered in Texas. In 2020, it had a reported revenue of $256 billion.
In March 2020, CEO Darren Woods dismissed oil and gas companies’ emissions intensity targets and divestment of fossil fuel assets as a “beauty competition”, which would not tackle climate change. Woods added that ExxonMobil would instead focus on solving climate change for society as a whole.
In 2019, it disclosed Scope 3 emissions of 730 million tonnes of carbon dioxide equivalent. This is roughly equivalent to the emissions of Canada.
The truth behind the greenwashing
ExxonMobil has not set a company-wide net-zero emissions target consistent with the Paris Agreement temperature goals. The company’s 2025 targets have been rejected as falling far short of the Paris goals and woefully inadequate for ignoring the vast majority of its climate impacts in the form of its Scope 3 emissions.
The Climate Action 100+ Net Zero Company Benchmark finds that ExxonMobil meets none of the Benchmark’s targets criteria – ExxonMobil does not have either an ambition to reach ‘net zero’ or net zero-aligned short, medium and long-term GHG reduction targets which cover its emissions. Exxon’s short-term targets are not considered by the Benchmark to cover all its emissions or to align with net zero pathways.
ExxonMobil is also scored ‘No’ for failing to commit to align its capital allocation (investments) with its targets, let alone with the Paris Agreement goal to limit global temperature rises to 1.5°C above pre-industrial levels.
The Benchmark estimates that over $10.4 billion of Exxon’s 2019 capital expenditure on ‘upstream’ fossil fuel extraction and production, and 88% of the company’s future capital expenditure, conflict with the International Energy Agency’s ‘Beyond Two Degrees’ scenario. In this scenario, total temperature rise is limited to 1.75°C by 2100. More and quicker emissions reductions would be required to limit temperature rise to the Paris goal of 1.5°C and to avert more climate harms to people and to the environment.
While ExxonMobil says it supports the Paris Agreement, the vast majority of its operations remain focused on fossil fuels.
But its ads tell a different story…
In March 2020, CEO Darren Woods dismissed oil and gas companies’ emissions intensity targets and divestment of fossil fuel assets as a “beauty competition”, pointing instead to steps to resolve climate change for society as a whole. Months later, in December 2020, Exxon bowed to investor pressure and issued targets for its own business.
In plans the company called “projected to be consistent with the goals of the Paris Agreement”, the company committed to reduce the intensity of upstream (Scope 1 and 2) emissions from its operated assets by 15-20% compared to 2016 levels, which it says is expected to deliver around 30% in absolute emission reductions for its "Upstream" business. It also published targets to reduce methane intensity by 40-50% and “flaring” intensity by 35-45%. Methane is a powerful greenhouse gas emitted during oil and gas extraction, and “flaring” is the common burning of unwanted gas during oil extraction and processing.
Whilst the company did not issue any targets to reduce its massive Scope 3 (downstream) emissions, it agreed to report on these emissions for the first time but distanced itself from them, saying that its “reporting of these indirect emissions does not ultimately incentivize reductions by the actual emitters”, meaning consumers and customers who buy Exxon’s fossil fuel products.
ExxonMobil says it has invested more than $10 billion in “lower-emission technologies” since 2000.
In February 2021, in a move seen as a response to activist investor pressure, the company unveiled a division called ‘Low Carbon Solutions’ and said it plans to invest $3 billion on “lower emission energy solutions” through 2025, focusing on carbon capture and storage.
ExxonMobil is a member of the Oil and Gas Climate Initiative, which operates a $1 billion fund to invest in new technologies to bring down emissions from the sector.
While ExxonMobil says it supports the Paris Agreement, the vast majority of its operations remain focused on fossil fuels. Between 2010 and 2018, ExxonMobil reportedly spent just 0.2% of its capital expenditure on sources of low-carbon energy like wind and solar.
ExxonMobil says that its 2019 Scope 1 and 2 emissions from its operations are 5% lower than they were in 2010. However, this is a selective claim - emissions in 2011, 2012, 2013, 2014, 2015, 2016, 2017 and 2018 were higher than in 2019, and at times were even higher than in 2010. The company does not give an average over the 2010-2019 period. Most importantly, the claim simply avoids the company’s Scope 3 emissions from its products, which are roughly seven times larger.
In 2018, ExxonMobil announced a seven-year, $210 billion investment plan, which would increase oil and gas production by an estimated 1 million barrels of oil equivalent per day. Although large oil companies typically avoid releasing emissions projections alongside published production, profits and investment forecasts, leaked documents showed that ExxonMobil estimated its oil and gas growth plan would increase its Scope 1 and 2 emissions by 17%, adding 21 million tons of CO2 emissions annually (more than the CO2 output of Kenya).
ExxonMobil has decided to set ‘carbon intensity’ targets rather than commit to absolute emissions reductions, but BP recognises that “[i]f all companies in the O&G sector choose to set only intensity reduction targets, then the associated absolute emissions could grow even if all targets were met”.
Whilst a September 2020 estimate ranked Exxon’s 2019 Scope 3 emissions at 528 million tons of CO2 equivalent, on 5 January 2021 and under significant investor pressure, the company disclosed its Scope 3 emissions from its products for the first time: 730 million tonnes of CO2 equivalent in 2019. This is roughly equivalent to the emissions of Canada. The company claims to have eliminated or avoided around 480 million tonnes of GHG emissions in total since 2000 through energy efficiency and mitigation of emissions, but this is a very small fraction of the emissions its business is responsible for.
ExxonMobil has not set a company-wide net-zero emissions target consistent with the Paris Agreement temperature goals. The company’s 2025 targets have been rejected as falling far short of the Paris goals and woefully inadequate for excluding the vast majority of its climate impacts in the form of its Scope 3 emissions.
Aligned with the Paris Agreement?
In the fine print, Exxon’s claim that its targets are “projected to be consistent with the goals of the Paris Agreement” does not stand up. Although the world’s governments have agreed to pursue efforts to limit temperature increase to 1.5 °C above pre-industrial levels, Exxon’s projection assumes a target of 2°C. The IPCC estimates the difference as millions of people exposed to climate dangers. The ‘full technology’ scenario that ExxonMobil uses relies heavily on unproven ‘negative emissions’ technology to forecast steadily increasing oil and gas production and continued investment. For instance, Exxon’s scenario assumes that carbon capture and storage (CCS) technology will grow from negligible amounts today to account for twice as much energy as renewable sources by 2040. This is despite the history of repeated failures to scale-up CCS and analysis that CCS power generation will develop too slowly for urgent climate goals. The company’s selective use of climate scenarios has come under criticism from analysts before.
ExxonMobil says that it does not have to reduce its fossil fuel production in order to align with the Paris Agreement. It claims that, if it reduced production, this would have no impact on demand for energy, fossil fuel production would just shift elsewhere and that “[i]mproved efficiency, effective government policies and informed consumer choices are more effective measures to address demand". Instead, the company says fossil fuel production should continue and focus on more efficient operators – like itself.
But the UN Environment Programme is clear that “Meeting climate goals requires a wind-down of fossil fuel production” on the supply side, to avoid locking in a future of severe climate disruption. The Programme’s 2020 Production Gap report also sets out the alternatives to continued fossil fuel growth – and notes that renewable energy is the cheapest source of new bulk electricity in 85% of the world. Although ExxonMobil refuses any responsibility to reduce fossil fuels, other fossil fuel companies have recognised their responsibility to transition away from fossil fuels and switch to renewable energy. By claiming that it will provide the dwindling supply of oil and gas as decarbonization progresses and gambling that others will reduce supply, ExxonMobil is taking an approach with real risks of worsening climate change.
ExxonMobil participates in liquefied natural gas (LNG) production amounting to almost 25% of the global LNG market. LNG is a particularly high-carbon method of storing and transporting gas. The company’s website says that ‘natural’ fossil gas is “helping the world shift to less carbon-intensive sources of energy”, and argues that the usage of gas “is projected to continue to expand rapidly”. The company’s adverts promote the use of ‘natural’ fossil gas to support variable renewable energy – gas power to step in when solar and wind generation isn’t enough.
However, this is not how fossil gas power is currently used. Gas power doesn’t just serve as a residual ‘backup’ function, filling the gaps at peak times when renewable energy is insufficient. In the US, gas is an increasing source of regular electricity generation - accounting for 24% in 2010, rising to 40% in 2020. Globally, gas is nearly a quarter of electricity generation. As a regular electricity source, gas competes with increasingly cheaper renewable energy, rather than supporting it. Experts say that gas production needs to be reduced to avoid locking in high carbon energy systems, which can be replaced with genuinely low-carbon renewable energy.
Carbon capture and storage distraction
As the self-proclaimed “leader in carbon capture”, the company says it captures about 9 million tonnes of CO2 per year. This represents less than 2% of its 2019 annual emissions of 730 million tons of CO2. The entire global operational capacity of carbon capture facilities did not quite stretch to 40 million tonnes of CO2 per year in 2020.
ExxonMobil plans to invest in CCS, including through its investment pledge for “lower emission energy solutions” to receive $3 billion through 2025. But this is dwarfed by its original 2018 oil and gas investment plan of $210 billion. The pledge amounts to less than $1b illion per year, whilst the company reported $14.4 billion on overall capital and fossil fuel exploration expenditure in its ‘Upstream’ business in 2020. Across ‘Upstream’, ‘Downstream’, ‘Chemicals’ and ‘Other’ business areas, ExxonMobil says it expects $16-19 billion in capital and exploration expenditure in 2021, and to maintain $20-25 billion every year through to 2025. In the company’s 2020 Annual Report, the CEO highlighted Exxon’s fossil fuel and petrochemical capital investment priorities: “high-performance chemical projects, refinery upgrades and, in the Upstream, our advantaged assets in Guyana, the Permian Basin, and Brazil."
A token biofuel project
Exxon’s algae biofuel project has been criticised as a long-running and token project, which offers no real prospect of economic feasibility, particularly in the face of rapidly falling electric vehicle costs. Against its 2020 capital and exploration expenditures of $21 billion alone, the company has spent $300 million on biofuels in the previous decade. That equates to $30 million per year, or about 0.14% of Exxon’s 2020 capital expenditure. In 2018, InfluenceMap assessed Exxon's spend on climate-related branding at $56 million per year.
Spreading doubt about climate change
ExxonMobil has been the subject of high-profile legal proceedings in the USA over evidence that it underwent a decades-long campaign to cover up evidence of human-caused global warming. Internal documents from the 1970s and 1980s show Imperial Oil Limited (Exxon’s Canadian subsidiary) was well aware that burning of fossil fuels increased CO2 in the atmosphere. Initially, Imperial Oil and ExxonMobil engaged in climate science programmes. But, by the late 1990s, Exxon and Imperial Oil were spreading doubt about climate change. In 1989, ExxonMobil became a founding member of the Global Climate Coalition - an international lobby group that opposed action to reduce greenhouse gas emissions and challenged the science behind global warming, but was disbanded in 2002. Since 1998, ExxonMobil is estimated to have spent over $33 million on groups that spread doubt and disinformation about climate change. When researchers showed that Exxon’s advertising activities spread doubt about whether climate change was real, in contrast to its internal documents, ExxonMobil sought to discredit the authors.
ExxonMobil is a member of a number of powerful trade associations with a history of lobbying against climate measures. These include the American Petroleum Institute, American Fuel & Petrochemical Manufacturers, the Australian Petroleum Production and Exploration Association, the Canadian Association of Petroleum Producers and Fuels Europe.
More to explore
We’ve put together explainers of some of the key terms and phrases used in these Greenwashing Files.
What are GHGs?
GHGs stands for greenhouse gases - this is the group of seven gases generally seen as contributing to global warming, including carbon dioxide (CO2) and methane (CH4).
What are the Paris goals?
The goals which countries agreed on in Article 2(1) of the 2015 Paris Agreement on climate change, to hold the increase in global average temperature to well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels.
What is CO2e?
CO2e stands for carbon dioxide equivalent, a measure of greenhouse gases. Other non-carbon dioxide greenhouse gases are converted to the equivalent amount of carbon dioxide on the basis of their global warming potential in order to produce a single greenhouse gases measure.
What are Scope 1-3 emissions?
Scope 1-3 emissions are the most widely used international carbon accounting tool. The Greenhouse Gas Protocol categorises a company’s GHG emissions into three groups:
- Scope 1 covers direct emissions from the company’s owned or controlled sources (e.g. burning fuel, company vehicles, emissions from the company’s own industrial processes).
- Scope 2 covers indirect emissions from the generation of electricity, steam, heating and cooling consumed by the company.
- Scope 3 includes all other indirect emissions that occur in a company’s value chain, including emissions from the use of its products.
Is gas clean?
Many fossil fuel companies make questionable claims about the sustainability of fossil fuel 'natural' gas, frequently marketed as ‘the cleanest-burning’ fossil fuel. Burning gas may produce less CO2 than burning coal or oil, but it is still carbon intensive, and not a viable long-term energy source – unlike renewable energy. Climate goals mean that gas use must be reduced, not increased.
On a full ‘lifecycle’ basis, generating electricity by burning gas produces on average more than 10 times the emissions of real low-carbon electricity sources like solar, and more than 40 times the emissions from wind power. As well as emitting significant CO2 when burnt, extracting, transporting and storing fossil fuel gas leaks methane, a powerful greenhouse gas. How much is leaked is critical - if leakage isn’t kept to low enough levels, the overall climate impact of gas can be worse than coal, the dirtiest fossil fuel. Measuring leakage is challenging, and significant advances in reducing leakage are needed.
Is gas a backup for renewables?
Currently gas power is not typically limited to a ‘backup’ function when variable wind and solar renewable energy drops off. Instead, gas is a significant source of regular electricity generation globally, providing electricity that could be replaced by increasingly cheaper renewables. Meanwhile, investments in new gas infrastructure with decades-long operating lifetimes are set to 'lock in' unsustainable greenhouse gas emissions.
Is carbon offsetting the answer to fossil fuels?
Companies’ climate plans increasingly rely on vague talk of huge ‘offsets’ or ‘nature-based solutions’ schemes instead of near-term reductions in fossil fuel production. These plans, even if costed and scalable, can in practice often involve vast commercial monoculture tree plantations, which can cause negative impacts on biodiversity and communities, and struggle to guarantee carbon storage for the hundreds of years which fossil fuel emissions will remain in the atmosphere. Some companies plan to claim the carbon ‘credits’ from existing forests by relying on questionable claims that the corporate offset schemes are the only way to stop deforestation. Carbon removals and offsetting schemes like this can be a part of tackling climate change. But they are not an alternative to prioritising cutting emissions for any sector, let alone for the fossil fuel industry.
Can we rely on carbon capture technology?
Analysis shows that reaching climate targets whilst continuing with today’s oil and gas projects would require a rapid and massive acceleration in carbon capture and storage (CCS). Despite long-running talk of big plans for CCS, companies have never operated it at anything like sufficient scale.
Today, global operational CCS capacity accounts for about 0.1% of global fossil fuel emissions, and the technology cannot capture 100% of emissions. Some companies plan to use, rather than store, captured CO2, often to extract yet more oil. CCS also does not avoid upstream methane emissions and may even increase these due to the additional energy required to run the technology.
There is a history of repeated failures to scale-up CCS, and plans for economically viable CCS have been called ‘wishful thinking’. Experts highlight numerous problems and barriers to short-term deployment and consider that any future development of CCS will now be too little, too late for urgent pathways to a safe climate.
Is biomass sustainable?
Some companies are now turning from fossil fuels to forest biomass energy. Wood biomass is treated as ‘renewable’ under EU and UK law, based on a carbon accounting rule where the GHG emissions from burning biomass are counted as ‘zero’.
However, in reality, burning wood biomass can produce even more CO2 emissions than burning fossil fuels. Sourcing the fuel for biomass through logging is also linked to deforestation - degrading the natural carbon sinks we need for a safe climate. The carbon accounting rule is highly controversial, and does not mean that biomass is in reality ‘low-carbon’ or ‘carbon-neutral’. Because of this, scientists warn that burning wood biomass for energy creates a double climate problem - because it is a false solution to climate change that is replacing real solutions.
What are carbon emissions targets?
Emissions intensity targets – An intensity target is relative to product output, for example the amount of GHGs per barrel of oil produced.
Absolute emissions targets - An absolute target simply refers to the overall amount of GHG emissions attributable to the company. Under many intensity targets, a company can maintain or even increase its overall GHG emissions, provided it increases production enough.
What does CCUS mean?
CCS stands for carbon capture and storage. This is the process of trapping carbon dioxide produced, for example, by burning fossil fuels and then storing it permanently so that it will not contribute to global heating. CCUS, or carbon capture, use or storage, additionally refers to the use of trapped carbon dioxide for some other process.
How do you define capital expenditure?
Capital expenditure is investment by a company on major fixed assets such as buildings, vehicles, equipment or land. This is different from operating expenditure, which represents day-to-day recurring costs like salaries or rent.
The Greenwashing Files have been produced and published by ClientEarth, an environmental law charity registered in England and Wales, with research assistance from DeSmog. For more details, please refer to the registration details in the footer of our website. The information included in the Greenwashing Files is as of 25 March 2021.
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