Oil giant ExxonMobil has taken important steps towards realising the ambitious investment plan it announced last year.
The company plans to spend billions in expanding its energy business in the coming years, with the target of doubling cash flow and earnings by 2025.
At the end of January, the company gave the go-ahead to projects that will be key to maximising the value of its operations in the Permian Basin. Construction will now moved ahead for the 650-mile Wink to Webster Pipeline, which is being built by ExxonMobil, together its partners, Lotus Midstream, and Plains All American Pipeline. The new pipeline will help alleviate the takeaway capacity constraints being felt as operators grow production faster than pipeline builders can keep up.
The new pipeline will transport up to a million barrels per day (bpd) from the Permian to refineries in the Houston area. This includes ExxonMobil’s own Beaumont facility, which also got the green light for the building of a new unit that will increase its refining capacity to 616,000 bpd and make it the biggest such facility in the country. The extra capacity will help the company to convert its crude oil from the Permian into more valuable refined products—like diesel, petrol, and high-quality lubricants like Mobil Velocite 3—which can then be sold domestically or exported.
By investing in its upstream, midstream, and downstream operations, ExxonMobil believes it can maximise its per-barrel profit and double its earnings and cash flow, even if oil prices remain at current levels.