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Earlier this month, BASF and ExxonMobil announced a strategic collaboration to advance methane pyrolysis technology for producing low-emission hydrogen, with a joint development agreement and plans to build a demonstration plant.
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The decision, combined with news that ExxonMobil paused its Baytown hydrogen project due to weak demand and economic uncertainty, highlights challenges faced by traditional energy companies in scaling up clean energy initiatives.
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Next, we’ll examine how the pause of the Baytown hydrogen project influences the investment narrative and future clean energy ambitions.
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To be a shareholder in ExxonMobil today, you generally need to believe in the company’s ability to generate steady returns from large-scale oil and gas projects while gradually scaling up its portfolio of lower-carbon solutions. The pause of the Baytown hydrogen project highlights near-term uncertainty around new energy revenue streams but does not materially impact Exxon’s main earnings driver, which remains its upstream oil and gas operations and associated cash flows.
Among recent announcements, the launch of Guyana’s expanded production facility stands out. This milestone reinforces Exxon’s central short-term catalyst, growing high-margin production from advantaged assets, which helps underpin financial resilience even as the company experiments with clean energy ventures facing economic headwinds.
However, despite these strengths, a key piece of information investors should be aware of is the ongoing risk that as ExxonMobil’s production mix relies more heavily on unconventional assets like the Permian, the company’s long-term…
Read the full narrative on Exxon Mobil (it’s free!)
Exxon Mobil’s outlook anticipates $338.3 billion in revenue and $39.7 billion in earnings by 2028. This scenario reflects a -0.8% annual decline in revenue but an $8.7 billion increase in earnings from the current $31.0 billion.
Uncover how Exxon Mobil’s forecasts yield a $128.44 fair value, a 11% upside to its current price.
Eight members of the Simply Wall St Community estimate ExxonMobil’s fair value from US$128.44 up to US$285.39 per share. While these perspectives vary, the recent pause in the Baytown hydrogen project highlights the uncertainties facing Exxon’s future diversification and earnings growth, inviting you to consider a range of views.
