ExxonMobil's Q4 Profits Fall 40%

US supermajor ExxonMobil January 31 reported Q4 2016 profit of $1.68bn, down 40% on the year-previous figure.

For the year as a whole, 2016 earnings were $7.8bn, including a US asset impairment charge of about $2bn mainly related to dry gas operations with undeveloped acreage in the Rocky Mountains. Excluding the impairment charge, taken in Q4, full year earnings were $9.9bn, compared with $16.2bn in 2015 – so just half of that year's profit and a quarter of the profits in both 2013 and 2014.

Profit for Q4 was $3.7bn, excluding the impairment charge, up from the $2.8bn reported in the year-ago period, owing to higher liquids sales but partly offset by weaker refining margins. Upstream, the company lost $642mn after the impairment.

Highlights in the quarter included the restart of the Kashagan oil field in Kazakhstan and the start of the second LNG Train at Gorgon in Australia. "Production continued to ramp up at these assets through the fourth quarter," it said.

Global production was down 127,000 barrels of oil equivalent (boe)/day to 4.1mn boe/d, or 3%, compared with the fourth quarter of 2015. Liquids production was 2.4mn b/d, down 97,000 b/d as field decline and lower entitlements were partly offset by increased project volumes, notably in Nigeria and Indonesia. Gas production was 10.4bn ft³/d, down 179mn ft³/day from 2015, as higher project volumes were more than offset by field decline and lower entitlements.

The poor year was also the last for Rex Tillerson as its CEO and chairman. He left the company at the end of December after several decades' service in order to join the administration of the new US president Donald Trump. He is now waiting to see if his nomination as secretary of state has met with the approval of the senators.

His successor in both roles, Darren Woods, commented on the results: “The company’s continued focus on fundamentals and our ability to leverage an attractive global portfolio through our integrated business ensures we are well positioned to generate long-term shareholder value.”

William Powell