Thursday, 06 August 2020 12:54

Exxon cutting budget, Shell and bp write off the losses

On Friday Exxon reported a record drop in cash flow from operations performed during the second quarter of 2020 - down to zero. 

As Senior Vice President Neil Chapman said during a telephone conversation with analysts, the company aims to reduce the budget, which will be a continuation of the reduction of Capex by $10 billion. Next year, the company will reduce expenses on upstream down to $19 billion.

Perhaps the main event was the suspension of deep-water oil projects in Guyana and Brazil, shale projects, and gas exports from Mozambique and Papua New Guinea.

As the company's analysts emphasize, the issues of mitigating the long-term decline in production and asset stability during the transition to a low-carbon economy remain open for Exxon.

As Chapman noted, the company is currently going a major revaluation of the cost of its assets, the results of which will be presented to the company's Board of Directors in November 2020”.

It is noteworthy that Royal Dutch Shell and bp plc. wrote off assets worth billions of dollars in the last quarter.

According to the results of stock trading at the end of last week, the market value of the oil and gas giant was $178 billion, compared to more than $500 billion a few years earlier.

 

 

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