Even as it reported a third-quarter loss of $680 million on Friday following its largest-ever loss of $1.1 billion in Q2 2020, ExxonMobil Corporation said it sees the global oil market as being in the ‘early stages of recovery’ and reiterated its commitment to ‘advantaged projects’ such as those in Guyana.
“We remain confident in our long-term strategy and the fundamentals of our business and are taking the necessary actions to preserve value while protecting the balance sheet and dividend,” said Darren W. Woods, Chairman and Chief Executive Officer (CEO). “We are on pace to achieve our 2020 cost-reduction targets and are progressing additional savings next year as we manage through this unprecedented down cycle.”
The company’s preliminary 2021 capital program, which will be reviewed by the board of directors in the fourth quarter, is expected to be in the range of $16 billion to $19 billion, a reduction from the 2020 target of $23 billion announced in April.
ExxonMobil said it expects to identify further structural efficiencies as it continues previously announced country-by-country reviews, which to date has seen plans moving forward to reduce its global workforce by 15% by the end of 2022. The cuts will include 1,900 U.S. jobs, mostly in Houston, as well as layoffs previously announced in Europe and Australia and reductions in the number of contractors, some of which have already taken place.
“We continue to progress industry advantaged developments in Guyana with the FID [Final Investment Decision] of Payara,” said Stephen Littleton, Vice President, Investor Relations, speaking on the Q3 earnings call. “In addition, we announced two new discoveries on the Stabroek Block – Yellowtail and Redtail – marking our 17th and 18th discoveries in Guyana.”
Payara is the third major project in the Stabroek Block and will have the capacity to produce up to 220,000 oil-equivalent barrels per day after expected startup in 2024. The company also increased the estimated recoverable resource to nearly 9 billion oil-equivalent barrels on block.
“We’re building out the in-country community to be successful over the long term,” Said Jack Williams, head of downstream and chemical operations. “In total, there are now more than 2000 Guyanese citizens supporting the project activities and more than 2500 Guyanese companies registered with the project’s Centre for Local Business Development that is focused on building local business capacity.”
ExxonMobil said given the high-quality opportunities in its portfolio and the constraints of the current market environment, it is assessing its full portfolio to prioritize assets with the highest value potential within its broad range of available opportunities.