Industry News

Exxon Mobil to purchase Denbury and its entire CCS portfolio for U$4.9bn

by | Jul 14, 2023

The Exxon Mobil Corporation has entered into a definitive agreement to acquire Denbury, a developer of carbon capture, utilization and storage (CCS) solutions and enhanced oil recovery. The acquisition is an all-stock transaction valued at U$4.9bn.

“Acquiring Denbury reflects our determination to profitably grow our Low Carbon Solutions business by serving a range of hard-to-decarbonize industries with a comprehensive carbon capture and sequestration offering,” said Darren Woods, chairman and CEO. “The breadth of Denbury’s network, when added to ExxonMobil’s decades of experience and capabilities in CCS, gives us the opportunity to play an even greater role in a thoughtful energy transition, as we continue to deliver on our commitment to provide the world with the vital energy and products it needs.”

ExxonMobil’s acquisition of Denbury will provide the company with the biggest owned and operated CO2 pipeline network in the USA at a length of 1,300 miles. This includes approximately 925 miles of CO2 pipelines in Louisiana, Texas and Mississippi within one of the largest US markets for CO2 emissions. A total of 10 onshore sequestration sites will also be acquired by ExxonMobil as part of the deal.

“This transaction is a compelling opportunity for Denbury to join an admired global energy leader with a low-carbon focus, a robust balance sheet and a leading shareholder return program,” said Chris Kendall, president and chief executive officer, Denbury. “Over the last few years, Denbury has made significant progress executing our strategic plan, strengthening our enhanced oil recovery operations and capitalizing on our unrivaled infrastructure to accelerate the growth of our CO2 transportation and storage business. Importantly, given the significant capital and years of work required to fully develop our CO2 business, ExxonMobil is the ideal partner with extensive resources and capabilities.”

“Denbury’s advantaged CO2 infrastructure provides significant opportunities to expand and accelerate ExxonMobil’s low-carbon leadership across our Gulf Coast value chains,” said Dan Ammann, president, ExxonMobil Low Carbon Solutions. “Once fully developed and optimized, this combination of assets and capabilities has the potential to profitably reduce emissions by more than 100 million metric tons per year in one of the highest-emitting regions of the U.S.”

The board of directors of both companies have approved the transaction which is still subject to customary regulatory reviews and approvals. It is also subject to approval by Denbury shareholders. It is anticipated that the transaction will close in Q4 of 2023.

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