ExxonMobil's board is assessing the viability of major gas projects in East Africa and South-East Asia in light of costs and the energy transition, according to the Wall Street Journal (WSJ).

Two specific projects about which there are concerns at board level are the $30 billion Rovuma LNG in Mozambique and the $10 billion Ca Voi Xanh gas scheme in Vietnam, the WSJ reported, citing people familiar with the matter.

However, in an email sent to Upstream, an ExxonMobil spokesman said: "The tone and the substance of the [WSJ] article are wrong," but did not elaborate nor respond to additional queries.

Neither project has been sanctioned, with Rovuma stalled by the knock-on effects of the Islamist insurgency in Cabo Delgado province where its liquefaction facilities will be located, as well as funding issues.

ExxonMobil’s board took on a fresh hue earlier this year when activist investor Engine No. 1 succeeded in getting three of its four nominees elected directors due to poor returns and climate-related issues.

The WSJ reported that the Mozambican and Vietnamese schemes form part of discussion about ExxonMobil’s five-year spending plan on which the board is set to vote at the end of this month.

ExxonMobil is analysing expected carbon emissions from each project and how they would affect its ability to meet pledges to reduce emissions, the newspaper said.

Annual projected emissions from the Mozambican and Vietnamese projects were among the highest in the supermajor’s portfolio of future upstream projects, according to a pre-pandemic internal analysis by Exxon, which was reviewed by the WSJ.

Rovuma CCS option

However, Upstream has been told that Rovuma’s emissions could turn out to be less than initially forecast because, during the pandemic, the supermajor asked its chosen engineering procurement and construction contractors — JGC, Fluor and Technip Energies — to assess the possibility of incorporating carbon capture and storage technology into the LNG facilities.

In July, Upstream reported that ExxonMobil could potentially walk away from the Vietnam scheme.

Sources in Vietnam familiar with the project and the dynamics of domestic oil and gas politics said ExxonMobil has been frustrated by local institutions and ministries that make it difficult to speed up the project.

These issues come on top of the Covid-19 pandemic and the energy transition.

Separately, meanwhile, the WSJ reported that ExxonMobil also plans to unveil in the coming weeks that it will raise its investment in a low-carbon unit it announced in February by billions of dollars.

Earlier this year, the US giant said it would invest $3 billion through to 2025 in a new division that aims to commercialise its CCS, hydrogen, biofuels and other technologies.

* Article and headline adjusted to reflect ExxonMobil view.

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