Exxon Mobil Corporation confirmed plans to reorganize its downstream reorganization, which will see the further integration of its downstream refining and fuels and lubricants businesses.
Charlotte Huffaker, Exxon Mobil public & government affairs spokesperson, confirmed with F&L Asia that “We are further integrating our downstream businesses to improve decision making and enhance performance in the market.”
“The improvements will help us to serve our customers and compete more effectively while continuing to leverage our global scale and the benefits of being a fully integrated oil, gas and petrochemical company,” she added.
The changes being made at the largest publicly traded integrated oil and gas producer in the world is reportedly the most sweeping so far, since Chairman and CEO Darren Woods took over in 2017, following the resignation of Rex Tillerson who became U.S. secretary of state.
Woods served as president of Exxon Mobil Corp. in 2016, senior vice president from 2014 to 2016, and vice president and president of ExxonMobil Refining & Supply Company, the downstream business of Exxon Mobil Corp., from 2012 to 2014.
Financial responsibility for the merged operation will be at the country and regional heads level, who will report to Exxon Mobil’s Irving, Texas, headquarters in the United States, rather than the functional level, effectively reverting decision-making back to a centralized set-up, at the U.S. headquarters as before.
Exxon Mobil operates 22 refineries in 14 countries, including Singapore, processing nearly 5 million barrels of oil per day. The firm builds chemical and refining plants in the same location, allowing managers to shift production between fuels or chemicals based on demand.
The reorganization aims to squeeze more profits from the downstream business as the company works to improve its exploration and production operations, which has been negatively impacted by lower crude oil and gas prices since 2014. The reorganization is also being made as ExxonMobil expands its refining division. Exxon Mobil is investing USD20 billion through 2022 to expand its chemical and oil refining plants on the U.S. Gulf Coast.
Exxon Mobil’s refining and chemicals business segments contributed more than USD4.2 billion each to company earnings last year, compared with USD196 million profit from exploration and production.
“We are always focused on strengthening our assets and brands, improving our customer offer and providing rewarding career opportunities for our employees as we grow the business,” Huffaker said.
“We have discussed the changes with employees and feedback has been supportive,” she added.
She said that the reorganization will not impact the organization of the chemical company, the group that Exxon Mobil’s synthetic base stocks business belong to.
Reuters reported earlier that it was not immediately clear if the changes will involve job cuts or executive departures. Huffaker told Reuters that she could not say if there would be any impact on jobs.