Exxon cuts 2015 spending 12% to $34 billion

3/4/2015

NEW YORK -- Exxon Mobil Corp. anticipates capital spending of about $34 billion in 2015—12% less than in 2014—as it continues to bring major projects online, the company reported Wednesday.

Exxon’s annual capital and exploration expenditures are expected to average less than $34 billion in 2016 and 2017, the Irving, Texas-based company added.

“We are capturing savings in raw materials, service, and construction costs,” Rex W. Tillerson, Exxon’s chairman and CEO, said at the company’s annual analyst meeting at the New York Stock Exchange. “The lower capital outlook also reflects actions we are taking to improve our set of opportunities while enhancing specific terms and conditions and optimizing development plans.”

However, despite the fall in spending, Exxon expects to start up 16 major oil and natural gas projects during the next three years and is on track to increase daily production to 4.3 MMboed by 2017, Tillerson said.

In 2015, Exxon expects to increase production volumes 2% to 4.1 MMboed, driven by 7% liquids growth. The volume increase is supported by the ramp up of several projects completed in 2014 and the expected startup of seven new major developments in 2015, including Hadrian South in the Gulf of Mexico, expansion of the Kearl project in Canada, Banyu Urip in Indonesia and deepwater expansion projects at Erha in Nigeria and Kizomba in Angola.

In 2016 and 2017, production ramp up is expected from several projects including Gorgon Jansz in Australia, Hebron in Eastern Canada and expansions of Upper Zakum in United Arab Emirates and Odoptu in Far East Russia.

“Exxon Mobil has a deep and diverse portfolio of opportunities around the world and a total resource base of more than 92 Bboe,” Tillerson said.

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