Sabrina Valle

HOUSTON (Reuters), -Exxon Mobil Corp said Wednesday that for the first times, some of its oil & gas properties might be impaired by climate change. According to a security filing.

At its annual asset review, which is conducted by the board of directors of the biggest U.S. oil firm, assets will be tested for climate impairments in “the context of overall enterprise risc”. According to it, “Certain assets might be at risk of impairment.”

Exxon (NYSE) had its 12-member board restructured earlier this year with three new directors. This proxy war weighed heavily upon the failure of the company to address climate change. Hedge fund Engine No. 1. was successful in convincing enough shareholders to allow a new board to improve performance and reconsider the strategy for energy transition.

Exxon didn’t immediately respond to our request for comment.

The directors will consider factors like future energy supply and regulation as well as government policies.

The company stated that there were restrictions.

Exxon stated that asset recovery assessments are not complete until they have been completed. “It is impossible to estimate the range or existence of future impairments reasonably,” Exxon added.

According to the Securities Filing, the producer claimed that climate change is a worldwide issue and required collaboration between government, private companies, consumers, as well as other stakeholders in order to come up with meaningful solutions.

Exxon announced Friday that it will increase its spending on carbon reductions to $15 billion by 2022-2027. This is the biggest budget of any major U.S. company and was seen as the first change in climate strategy under the new board.

Exxon, along with other U.S. Oil Majors, has a climate strategy that relies on the development of new decarbonization technology from scratch. These technologies include carbon capture and hydrogen.

Top executives of the U.S. producers were grilled before Congress last month https://www.reuters.com/article/idCAKBN2HI1BD?edition-redirect=ca for their communication strategy on global warming. These executives were also quizzed about their focus on oil and natural gas production while European producers shift to renewable energies like solar power.

The top U.S. producers https://www.reuters.com/business/cop/investors-board-us-oil-majors-dismiss-wind-solar-projects-2021-10-27 have decided against investments in solar and wind power projects, with investors onboard.