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ExxonMobil (XOM) Invests More Than $900M in Guyana Since 2015

Exxon Mobil Corporation XOM and partners invested more than $400 million locally in Guyana in 2022, per a report by Reuters.

This is part of the $900-million-plus investment that the company has made since its first oil discovery in Guyana in 2015. ExxonMobil and partners approved investments worth more than $42 billion in Guyana. A significant portion of the budget has been so far allocated to shipyards in Asia.

The amounts were disclosed after the Guyana government approved ExxonMobil’s 2023 local content plan, which describes the integrated energy major’s strategies to support local industry.

By the 2022-end, ExxonMobil and partners hired more than 5,000 Guyana workers, indicating more than 65% of the entire workforce in the local oil and gas industry.

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Guyana has become one of the world’s booming oil producers after ExxonMobil’s first crude discovery there in 2015. ExxonMobil-led installations in the Stabroek region are extracting 360,000 barrels of oil per day, which is expected to triple by the end of the decade.

Guyana has become a key producing region for ExxonMobil. This is an important reason why the company’s stock has outperformed peers in the post-pandemic era. ExxonMobil operates the Stabroek block with a 45% interest.

In May, ExxonMobil violated its environmental permit in Guyana for failing to provide adequate oil-spill insurance. XOM has until Jun 10 to give unlimited assurance that the company and its partners will be responsible for all clean-up costs if there is a spill in the consortium’s area of operations.

The court also found Guyana’s Environmental Protection Agency violating its duty to enforce ExxonMobil’s environmental regulations. XOM is reviewing the court’s decision and evaluating potential measures.

Price Performance

Shares of ExxonMobil have outperformed the industry in the past six months. The stock has lost 5% compared with the industry’s 5.3% decline.

 

Zacks Investment Research
Zacks Investment Research


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Zacks Rank & Key Picks

ExxonMobil currently carries a Zack Rank #3 (Hold).

Investors interested in the energy sector may look at the following companies that presently buy a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cheniere Energy Partners, L.P.’s CQP recorded first-quarter 2023 earnings per unit of $1.43, beating the Zacks Consensus Estimate of 70 cents. Strong quarterly earnings resulted from a rise in the volumes of LNG delivered and a lower cost of sales.

For 2023, the partnership stated its guidance for distribution per unit at $4-$4.25. In the first quarter, Cheniere generated an operating net cash flow of $847 million, higher than the year-ago quarter’s $800 million.

Dril-Quip, Inc. DRQ reported a first-quarter adjusted loss of 1 cent per share, narrower than the Zacks Consensus Estimate of a loss of 2 cents. Strong quarterly results were supported by improved performances of key offshore markets and some reemerging areas.

For 2023, Dril-Quip expects product bookings to increase 10-20% year over year. Dril-Quip reported net bookings of $53.5 million for the first quarter. DRQ’s first-quarter backlog rose 6% year over year due to the increase in product bookings following improvement in market conditions.

Motor fuel retailer Murphy USA Inc. MUSA announced first-quarter 2023 earnings per share of $4.80, which beat the Zacks Consensus Estimate of $4.06. The outperformance can be attributed to higher volumes and retail fuel contribution.

MUSA remains committed to returning excess cash to its shareholders through continued share buyback programs. As part of this initiative, the fuel retailer recently approved a repurchase authorization of up to $1.5 billion following the completion of the existing $1-billion mandate. The move underscores MUSA’s sound financial position and commitment to rewarding its shareholders.

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Exxon Mobil Corporation (XOM) : Free Stock Analysis Report

Dril-Quip, Inc. (DRQ) : Free Stock Analysis Report

Murphy USA Inc. (MUSA) : Free Stock Analysis Report

Cheniere Energy Partners, LP (CQP) : Free Stock Analysis Report

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