​Exxon eyes oil M&A as it sees clean energy shift taking decades

Exxon Mobil CEO Darren Woods. Image: Exxon Mobil

Exxon Mobil Corp. Chief Executive Officer Darren Woods is eyeing oil and natural gas deals despite calls to reduce emissions, saying any shift in the world’s energy supply will take decades.

“Energy transitions take a long time,” Woods said Wednesday at the Barclays CEO Energy-Power Conference in New York. “In the meantime, the world’s rising demand for energy must be met.”

Exxon sees oil demand growing at 0.6% per year over the long term and demand for natural gas increasing 1.3% per year even as policy makers look for ways to wean countries off of fossil fuels. That means significant new investments, including acquisitions, will be needed at a time when shareholders are calling for Big Oil to reduce spending and return more cash to shareholders, Woods said.

More consolidation is in the offing for independent shale drillers, and Exxon will be watching for potential acquisition targets, he said.

“If there there is the opportunity to acquire something that bring unique value to Exxon Mobil, we’ll be in a position to transact on that,” Woods said.

Even though Exxon is spending heavily on megaprojects including deepwater oil drilling in Guyana and liquefied natural gas production in Papua New Guinea, the company will “retain the capacity for a sizable acquisition,” Woods said, without naming any specific targets.

He’ll look for deals at the bottom of the price cycle, he said. “Those are where we’ll see value opportunities.”

© 2019 Bloomberg L.P.

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