ExxonMobil makes cuts, keeps Gulf Coast investments amid virus pandemic
ExxonMobil, a multinational oil and gas corporation headquartered in Texas, announced Tuesday that it plans to reduce its 2020 capital spending by 30 percent and lower cash operating expenses by 15 percent as a result of the COVID-19 pandemic's impact on the economy.
The company's chairman and chief executive officer, Darren Woods, released a statement regarding the plan, saying, “After a thorough evaluation of the impacts of the pandemic and market conditions, we have worked closely with business partners to plan and execute capital adjustments that preserve long-term value, maximize cost efficiency, and put us in the strongest position when market conditions improve.”
Despite the fact that capital investments for 2020 are now expected to be about $23 billion -down from the previously announced $33 billion- and that as a result, a 15 percent decrease in cash operating expenses is being implemented, the refinery in Louisiana may not be as hard hit.
ExxonMobil says it expects to meet its projected investment of $20 billion on U.S. Gulf Coast manufacturing facilities made in its 2017 Growing the Gulf initiative.
The company also expects to reach its proposed U.S. investment of $50 billion over five years announced in 2018.
“While COVID-19 has had a significant impact on the global economy, we are confident that trade, transportation and manufacturing will recover,” said Woods. “ExxonMobil continues to invest in the projects that will position us to support economic recovery and capture value for our shareholders.”
In addition to taking financial measures to protect the company, Exxonmobil says it's protecting individual workers by enhancing cleaning procedures and implementing modified work practices at sites around the world.
The company is also maximizing production of products critical to the global response, including isopropyl alcohol, which is used to manufacture hand sanitizer, and polypropylene, which is used to make protective masks, gowns and wipes.
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