{"id":56939,"date":"2021-02-28T08:56:55","date_gmt":"2021-02-28T13:56:55","guid":{"rendered":"https:\/\/olduvai.ca\/?p=56939"},"modified":"2021-02-28T14:37:10","modified_gmt":"2021-02-28T19:37:10","slug":"analysis-how-exxon-is-being-forced-to-accept-the-reality-of-bad-fossil-fuel-investments","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=56939","title":{"rendered":"Analysis: How Exxon Is Being Forced To Accept The Reality Of Bad Fossil Fuel Investments"},"content":{"rendered":"

Analysis: How Exxon Is Being Forced To Accept The Reality Of Bad Fossil Fuel Investments<\/a><\/h3>\n
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\"ExxonMobil\"<\/div>\n<\/div>\n<\/div>\n
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Last August, ExxonMobil warned<\/a>\u00a0that it may need to remove 20 percent of its oil and gas proved reserves from its books. While that was a shocking number from the oil major, reality proved to be even more of a shock to the company.\u00a0On February 24<\/a>, Exxon reported that it would actually\u00a0remove over 30 percent<\/a>\u00a0of its proved reserves from its books \u2014 essentially wiping out the value of its Canadian tar sands holdings from its\u00a0books.<\/div>\n<\/div>\n<\/div>\n
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According to the Securities and Exchange Commission (SEC<\/span>),\u00a0proved reserves<\/a>\u00a0<\/a>are \u201cthe estimated quantities of crude oil, natural gas, and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating\u00a0conditions.\u201d<\/p>\n

Proved reserves are the concept on which\u00a0the whole oil business is based.\u00a0It is a main factor in how oil and gas companies are valued and in determining how much money banks will loan companies. Much of oil and gas lending is known as\u00a0reserved-based\u00a0lending.<\/a><\/p>\n

Exxon\u2019s latest move is even more remarkable, however,\u00a0<\/strong>because it has\u00a0a reputation<\/a>\u00a0for being resistant to properly valuing reserves, often\u00a0lagging behind the other oil major companies<\/a>\u00a0in making these downward\u00a0adjustments.<\/p>\n

In this case, the market \u2014 and the\u00a0SEC<\/span>\u2014 forced Exxon\u2019s hand on the matter.\u00a0SEC<\/span>\u00a0rules require that oil and gas companies value\u00a0reserves based on the average price of oil<\/a>\u00a0from the\u00a0previous 12\u00a0months.<\/a><\/p>\n

In its\u00a0latest\u00a0SEC<\/span>\u00a0filing<\/a>\u00a0released this week, Exxon explains that this requirement essentially meant removing all of the value for its Canadian tar sands investments from its\u00a0reserves.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n

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Analysis: How Exxon Is Being Forced To Accept The Reality Of Bad Fossil Fuel Investments Last August, ExxonMobil warned\u00a0that it may need to remove 20 percent of its oil and gas proved reserves from its books. While that was a shocking number from the oil major, reality proved to be even more of a shock […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3],"tags":[5317,4390,1015,11782,709,711],"class_list":["post-56939","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","tag-desmog-blog","tag-exxon","tag-fossil-fuel","tag-justin-mikulka","tag-sec","tag-securities-exchange-commission"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56939","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=56939"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56939\/revisions"}],"predecessor-version":[{"id":56948,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56939\/revisions\/56948"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56939"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56939"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56939"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}