ExxonMobil (Exxon) has announced fresh cost-cutting measures amid activist pressure, in a bid to boost returns and accelerate its transition to a greener future.
It has now embarked on a sweeping restructuring of its global operations that will combine its refining and chemicals businesses into one, and put its energy transition business on the same footing as its other operations.
Following the announcement, Exxon will be established along three business lines: its upstream oil and gas production unit, the combined downstream refining and chemicals business, and its latest energy transition business, called Low Carbon Solutions.
Chief executive Darren Woods said: “Aligning our businesses along market-focused value chains and centralizing service delivery, provides the flexibility to ensure our most capable resources are applied to the highest corporate priorities and positions us to deliver greater shareholder returns.”
This is the latest measure from the multinational oil and gas corporation to appease its critics, after activists won three seats on its board last spring.
It follows Exxon releasing a new climate strategy committing to cut oil and gas emissions to net zero by 2050, and the launch of its sale of shale gas properties stretching across 27,000 acres in the Appalachian basin last month.
The latest shake-up also comes ahead of its fourth-quarter results, which are expected to be announced today.
Despite pressure from activists, Exxon has posted three straight quarters in a row of rising revenue and net income, including its most profitable quarter in several years in the third quarter.
Two months ago, it unveiled a $10bn share buyback program, which will begin this year, while the board recently declared a cash dividend of $0.88 per share.
Alongside the restructuring, Exxon will relocate its corporate headquarters from Irving, Texas, to its campus north of Houston.
The move is expected to be completed in mid 2023.