The Irving, Texas, company, which is already struggling to maintain a $15 billion-a-year dividend program, filed a Form 8K with the Securities and Exchange Commission saying that it would take a write-down of as much as $20 billion on its upstream assets.
Exxon said upstream changes quarter over quarter would weigh on its results despite improving gas and liquid prices. Downstream refining margins are expected to potentially squeeze and mark-to-market derivative impacts will be negative, it said.
Exxon is scheduled to report its fourth-quarter results on Feb. 2. Analysts surveyed by FactSet project a quarterly loss of 2 cents a share, or an adjusted break-even per share, on revenue of $45.88 billion.
Earlier this month, the company said it would write down the value of natural gas properties $17 billion to $20 billion and cut project spending next year.
Exxon Mobil said it was removing gas projects from its plans in Appalachia, the Rocky Mountains, Oklahoma, Texas, Louisiana, Arkansas, Canada and Argentina.
The impairment is the company’s biggest ever such write-down.
At the top end of the range, Bloomberg reported, it would be the industry’s steepest impairment since BP’s (BP) – Get Report Gulf of Mexico oil spill in 2010, which killed 11 workers and polluted the sea for months.
Exxon Mobil Chairman and Chief Executive Darren Woods said in a statement that the business environment in the fourth quarter is showing signs of improvement despite the resurgence in covid-19 cases and accompanying economic restrictions.