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Exxon Mobil forecasts increases in project spending, output

Exxon Mobil forecasts increases in project spending, output
© Reuters. FILE PHOTO: A 3D printed natural gas pipeline is placed in front of displayed ExxonMobil logo in this illustration taken February 8, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

 

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By Sabrina Valle

(Reuters) -Exxon Mobil will increase annual project spending to between $22 billion and $27 billion through 2027, the company said in an update that largely continues existing spending and production targets.

The plan leaves out expected gains from the $60 billion acquisition of Pioneer Natural Resources (NYSE:PXD), which is expected to close next year. Exxon (NYSE:XOM) has received two requests for information on the deal from the U.S. Federal Trade Commission.

Exxon bought Pioneer in October for nearly $60 billion in a all-stock deal due to close in the first half of 2024, saying it plans to more than tripling production in the U.S. shale to 2 million barrels per day by 2027.

Exxon’s spending outlook will raise outlays for its energy transition unit, called Low Carbon Solutions, to $20 billion between 2022 and 2027, from $17 billion. But the higher spending will require government support.

“We need technology-neutral durable policy support, transparent carbon pricing and accounting, and ultimately, customer commitments to support increased investment,” Chief Executive Darren Woods said in a statement.

Exxon will increase its share buybacks to $20 billion annually through 2025, from $17.5 billion currently, after the Pioneer merger closes.

Shares were up a fraction in pre-market trading on Wednesday after closing down about 2% at $100.44.

The company forecasts production of 3.8 million barrels of oil equivalent per day (boepd) in 2024, from 3.7 million bpd this year, as the top U.S. oil producer bets on a lift from the Permian shale basin and Guyana.

Spending on new projects will expand to between $23 billion and $25 billion next year, with a range that has a mid-point spending of $24.5 billion annually from 2025 through 2027.

The company has said it expected output to be flat until the end of this year, at 3.7 million boepd, due to its withdrawal from Russia.

Source: Investing.com

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