ExxonMobil (XOM) was surrounded by critics before the Russian invasion of Ukraine.
But the conflict has caused crude oil prices to soar, which should have a very positive effect on the profits of the Irvin, Texas-based group and its rivals in the first quarter which is ending.
If ExxonMobil can easily at all, this respite is only temporary, because the prices of crude oil will eventually fall — and with them, a decline in profits for the oil industry.
And when that happens, the criticisms and questions about the future of the company will immediately return.
ExxonMobil is aware of that. To prepare for this, the oil giant has just made a hiring which says a lot about its desire to respond to its detractors and prepare the future.
The company has just appointed Dan Ammann as head of its new division dedicated to focusing on commercializing low-emission business opportunities in carbon capture and storage, hydrogen and low-emission fuels.
Ammann, a former investment banker, is well-known in the automotive industry and in Silicon Valley circles.
He was also president of General Motors (GM) from 2014 to 2018. The former right arm of CEO Mary Barra was then appointed CEO of Cruise, a subsidiary of autonomous vehicles of the Detroit vehicle manufacturer.
Under pressure from shareholders worried about the effects of climate change on the company's profitability, ExxonMobil announced last year that it was creating a business unit dedicated to cleaner energy, ExxonMobil Low Carbon Solutions.
The company has also announced a plan to reduce greenhouse gas emissions in its operations by 2025.
The Defender of Autonomous Vehicles at GM
Ammann is credited with being the architect of GM's offensive in autonomous vehicles.
It was reportedly he who notably pushed to invest in Cruise to make it one of the leading players in the same way as Tesla (TSLA) in these technologies. At the head of Cruise, Ammann has pushed for an expansion, growing the startup from around 40 employees to nearly 1,000 currently.
GM currently praises Ultra Cruise, the driver assistance system developed by Cruise as a "door-to-door," hands-free driving system that will allow users to avoid steering in 95% of all traffic situations.
Ammann abruptly left Cruise in December, with his departure reportedly due to a rift with Barra over Cruise's future. Ammann pushed for an IPO of the company while Barra opposed it according to various media.
He was previously GM’s chief financial officer and joined GM as treasurer in 2010. He also helped lead GM's initial public offering following the company’s 2009 restructuring.
“We welcome Dan to ExxonMobil and will use his knowledge and experience to continue to build our Low Carbon Solutions business,” said Darren Woods, chief executive officer and chairman, in a statement.
Ammann will become president of ExxonMobil Low Carbon Solutions, effective May 1, replacing Joe Blommaert, who is retiring after 35 years of service, ExxonMobil said.
$15 Billion of Planned Investments
ExxonMobil's new Low Carbon Man is already showing his ambitions long before he even takes office.
"Excited to announce that I’m going to lead the building of a new business at ExxonMobil focused on the (very) large scale decarbonization of the industrial economy," Ammann wrote on his LinkedIn Page.
"We’ll be significantly moving the needle toward net zero in the most hard-to-decarbonize industries, in an economically viable way, and with urgency."
He said that he has plans to achieve this highly ambitious goal.
"We’ll draw on the deep resources and know-how that exist inside of ExxonMobil today, together with the best external ideas and an initial $15 billion capital commitment that the company has made to build this business and reduce emissions," he wrote.
He wrote that he knows that critics are skeptical that ExxonMobil will suddenly turn into a clean energy champion. Ammann asks for the benefit of the doubt, like when he took the reins at Cruise.
"Having spent the last few years leading the incredible team at Cruise as we took self-driving cars from the realm of science fiction to an early commercial product that will fundamentally change transportation," he said.
"The bar was always going to be high in terms of what next mission could have a similarly massive potential impact. That said, with this opportunity I think I’ve found it!"
He tagged the post "#exxonmobil.
