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Chevron (CVX), ExxonMobil Opt Out of COP28 Methane Fund

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Chevron Corporation (CVX - Free Report) and Exxon Mobil Corporation (XOM - Free Report) have decided not to participate in a grant fund aimed at aiding developing countries in curbing methane emissions at the COP28 climate summit in Dubai, per a Bloomberg report.

The project, launched at COP28, allocates an initial fund of $255 million to address methane emissions from developing countries' national oil companies. Additionally, several countries, including the United Arab Emirates with $100 million, the United States with $2 million, Germany with $1.5 million and Norway with $1 million, have also pledged their support to address the urgent need for methane reduction.

Despite substantial contributions from some notable players in the industry, Chevron and ExxonMobil — two of the world’s biggest energy companies — remain absent from the list of contributors. Industry observers believe a lot of that has to do with reluctance on the American supermajors’ part to finance a fund that essentially provides monetary support to their global competitors (or the national oil companies).

Exxon Mobil responded to the development by stating that while it currently refuses to participate in the funding, it supports the overarching goal of the Global Methane Reduction Fund. The company expressed the possibility of contributing technical expertise in methane detection and mitigation as an alternative means of aiding the emission reduction initiative.

Chevron's absence from the fund aligns with its decision to not participate in a pledge made by 50 oil and gas producers, including ExxonMobil, at COP28. This collective commitment aims to reduce methane emissions from the companies’ operations to near-zero and cease the flaring of natural gas by the end of the decade.

Zacks Rank & Key Picks

Both Chevron and ExxonMobil currently carry a Zacks Rank #3 (Hold).

A couple of better-ranked stocks in the energy sector are Matador Resources Company (MTDR - Free Report) and Liberty Energy Inc. (LBRT - Free Report) . While Matador Resources sports a Zacks Rank #1 (Strong Buy), Liberty Energy carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Matador Resources is among the leading oil and gas explorers in the shale and unconventional resources in the United States. The company’s prime intention is to create more value for shareholders and generate lucrative returns from the capital invested in unconventional plays.

MTDR’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 13.89%.

Liberty Energy is a North American provider of hydraulic fracturing services to upstream energy operators. The company’s multi-basin presence offers an attractive upside opportunity compared with most of its peers. Liberty's strong relationship with high-quality customers provides revenue visibility and business certainty.

LBRT’s earnings beat estimates in three of the trailing four quarters and missed once, delivering an average surprise of 9.88%.

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