US oil major ExxonMobil has announced that it has agreed to buy Denbury Inc. In an all-stock transaction worth $4.9 billion, the purchase is based on the ExxonMobil share price at the time.
Denbury specialises in enhanced oil recovery and carbon capture, utilisation and storage (CCUS) solutions. ExxonMobil, which produces lubricants like the Mobil EAL Arctic series of refrigeration compressor oil, has been actively investing in CCUS technologies, so the acquisition of Denbury will synergise well with its existing low-carbon business.
Exxon CEO and Chairman Darren Woods said the acquisition demonstrated the company’s resolve to grow its business by offering carbon capture and storage solutions to various industries that are hard to decarbonise, adding:
“The breadth of Denbury’s network, when added to ExxonMobil’s decades of experience and capabilities in CCS, gives us the opportunity to play an even greater role in a thoughtful energy transition, as we continue to deliver on our commitment to provide the world with the vital energy and products it needs.”
Once Exxon completes the acquisition of Denbury, it will gain a CO2 pipeline network totalling 1,300 miles, the biggest owned and operated network in the United States, as well as 10 onshore sequestration sites at strategic locations. What’s more, most of this network is located in Texas, Louisiana, and Mississippi, which is a heavily industrialised area with a large potential demand for reducing CO2 emissions. Having a CO2 transport and storage network that is cost efficient will be vital for ExxonMobil to roll out CCUS and other low-carbon solutions to its customers in the coming years.