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ExxonMobil Focuses on Methane Emission Reduction in U.S.

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World's largest publicly traded oil company, ExxonMobil Corporation (XOM - Free Report) recently launched a plan to restrain its methane emissions from its onshore assets in the United States. The company plans to replace its old equipment with updated technology.

Details

The replacement plan is a three-year program. The outdated natural gas-powered pneumatic pumps are more prone to leak methane and thus will be replaced by the company. ExxonMobil will replace these pumps with compressed air-powered pumps, which will provide better pressure and temperature regulation in oilfield equipment.

ExxonMobil will also focus on employee training to reduce methane emissions. The company plans to study the use of satellites, drones and other relevant equipment in controlling future leakages. The company's ally, National Oceanic and Atmospheric Administration may help the company with using drones for detecting methane.

XTO Energy, a subsidiary of ExxonMobil, will lead the program. Financial details are yet to be disclosed.

Reason

The increasing gas production from the U.S. shale has given rise to methane emissions in the last few years. The company expects the move to reduce its environmental footprint. It will also help ExxonMobil to fight the recent accusations from environmentalists following a study that shows the company publicly downplaying climate change facts stated by its own scientists.

Methane is a chemical compound that is a part of natural gas and can be sold. Studies showed that new gas-fired plants, which ExxonMobil is planning to install, can reduce net greenhouse gas emissions.

In this context, we would like to remind investors that other industry majors like BP plc (BP - Free Report) , Chevron Corporation (CVX - Free Report) and Royal Dutch Shell plc are also working toward lowering carbon footprint.

About the Company

Irving, TX-based ExxonMobil is the world’s largest publicly traded oil company, engaged in oil and natural gas exploration and production, petroleum products refining and marketing, chemicals manufacture, and other energy-related businesses. Approximately 83% of ExxonMobil’s earnings come from operations outside the United States. The company divides its operations mainly into three segments: Upstream, Downstream and Chemicals.

ExxonMobil is the world’s best run integrated oil company, given its track record of high return on capital. It has collaborated with Russia for exploring potential commercial reserves in the country. However, tensions between the United States and Russia might affect its efforts to generate shareholder value by using Russian oil and gas reserves.

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