ExxonMobil’s CCS Trajectory: Navigating Volatility From High Ambition to Policy Shocks

Industry Adoption: A Shift from Foundational Growth to High-Stakes Volatility

Between 2023 and 2024, ExxonMobil’s Carbon Capture and Storage (CCS) strategy progressed from foundational groundwork to tangible, diversified commercialization. The period began with exploratory steps, such as the Q1 2023 MOU with Mitsubishi and Nippon Steel, and quickly advanced to concrete industrial applications. A key inflection point was the Q2 2023 offtake agreement with Nucor to capture 800,000 tons of CO2 from a steel plant, signaling CCS adoption in heavy industry. This momentum was amplified in 2024 with an EPC contract for a major Louisiana CCS project and a strategic diversification into novel applications, highlighted by a plan to build a natural gas power plant with over 90% CO2 capture to supply electricity directly to data centers. This demonstrated an expanding view of CCS, moving beyond traditional industrial abatement to servicing the high-energy needs of the technology sector, a significant new opportunity.
The landscape shifted dramatically in 2025. The year began with a signal of mega-ambition: a landmark $10 billion MOU with Indonesia to advance CCS, suggesting a massive scaling of international efforts. This was followed by a significant commercial deal with Calpine Corporation to capture and store 2 million metric tons of CO2 annually from a US power plant. However, this positive momentum was met with severe headwinds. The cancellation of a CCS project in Southeast Asia and, more critically, the US Department ofEnergy’s rescission of clean energy grants, directly impacting an ExxonMobil project, exposed the segment’s vulnerability. This contrast between large-scale ambition and susceptibility to policy shocks indicates that while CCS technology is being adopted for larger and more diverse applications, its path to mainstream adoption has become more polarized and fraught with financial uncertainty.

2025: Volatility and High Ambition: Between Mega‑Partnerships and Policy Shocks

Q1 2025
Emerging Themes and Technological Readiness: The quarter began with a major signal of international market development. ExxonMobil and Indonesia signed a landmark $10 billion Memorandum of Understanding (MoU) to advance CCS technology, indicating strong commitment and large-scale ambition in the Southeast Asian market. This single commercial event set a positive tone for the year.
Risk and Financial Viability Assessment: Alongside positive momentum, signs of commercial sensitivity emerged. In January, ExxonMobil urged a state agency in Texas not to disclose agreement terms for a CO2 project, creating negative sentiment and raising concerns about transparency and project viability.
Market Sentiment and PR vs Commercial Activities: The charts for Q1 reflect a market that is building momentum but with underlying tensions. Public relations (PR) activities outpaced concrete commercial events, with the activity chart showing PR levels at three times the volume of commercial agreements. This initial gap suggests a period of groundwork and negotiation. Concurrently, both positive and negative sentiment began to rise from their 2024 levels, indicating an active but increasingly polarized market narrative.

Q2 2025
Emerging Themes and Technological Readiness: The quarter saw a surge in activity, reinforcing CCS as a key decarbonization pathway for heavy industry. ExxonMobil signed a significant commercial deal with Calpine Corporation to capture and store up to 2 million metric tons of CO2 annually from a Texas power plant. Further positive developments included a new partnership involving ADNOC, ExxonMobil, and Occidental to advance carbon capture in the UAE and US, and regulatory progress with 1PointFive (an Oxy subsidiary) receiving EPA approval for CO2 storage.

Risk and Financial Viability Assessment: Despite positive announcements, Q2 was marked by significant setbacks. ExxonMobil cancelled a CCS project in Southeast Asia in April for undisclosed reasons, signaling potential strategic pivots or regional challenges. The most significant headwind came from a shift in US government policy.

Government Subsidies and Grants Analysis: In a major blow to the sector, the US Department of Energy (DoE) rescinded $3.7 billion in clean energy grants. This decision directly impacted ExxonMobil, which lost a $331 million grant, and led to the cancellation of a related $706 million contract with Eastman Chemical. This event exposed the sector’s high dependency on government subsidies and introduced considerable financial uncertainty for projects presumed to be on a clear commercialization track.

Market Sentiment and PR vs Commercial Activities: The Q2 charts illustrate a market at a fever pitch. PR activities skyrocketed, reaching a peak for the year, while logged commercial events remained flat. This dramatically widened the gap between announcements and executed deals to its largest point in recent years. This divergence was mirrored in the sentiment chart, where both positive sentiment (driven by new deals) and negative sentiment (fueled by the grant cancellations) spiked to their highest recorded levels. This suggests a highly volatile market where major steps forward are being met with equally significant setbacks.

Annual Pattern & Strategic Insights

Annual Commercialization Pattern Summary

The commercialization pattern for CCS in 2025 is best described as volatile and aspirational. Activity surged in the first half, driven by a flurry of PR announcements that peaked in Q2. However, the volume of tangible commercial agreements has remained low and flat, creating a significant and growing disconnect between stated ambition and on-the-ground implementation. The year’s narrative is a mix of promising international partnerships and major domestic policy and financial headwinds, painting a picture of a segment striving for maturity but still vulnerable to external shocks.

SWOT Analysis

Strengths: Formation of large-scale international partnerships (e.g., $10B Indonesia MoU); execution of significant commercial offtake agreements (e.g., Calpine deal for 2M tons/year); growing regulatory clarity in key jurisdictions (e.g., EPA approvals).
Weaknesses: High dependency on government subsidies, creating financial instability when policies shift; a widening gap between PR and commercial milestones, which could signal hype or execution challenges; lack of transparency in some project agreements.
Opportunities: Enormous addressable market as heavy industries and nations pursue mandated decarbonization targets; potential to establish CCS hubs through multi-company collaborations like the one with ADNOC and Occidental.
Threats: Policy and funding uncertainty from governments, as demonstrated by the DoE grant cancellations, remains the most significant risk; project cancellations can erode investor confidence; competition from other, potentially more mature, clean technologies.

Segment-Specific Hypothesis Formulation

Negative or Cautious Market Hypothesis (Slow Adoption, Higher Risk): Persistent gaps between PR activities and actual commercial implementation, rising costs, regulatory uncertainties, and recurring project setbacks indicate sustained challenges and slower-than-expected mainstream adoption for CCS. The events of 2025, particularly the significant impact of the US grant cancellations and the widening chasm between announcements and finalized deals, strongly support this cautious outlook. While ambition is high, the path to widespread, subsidy-independent commercialization remains fraught with risk.show market pull, the combination of plant underperformance, financial restructuring through layoffs, and the resulting spike in negative sentiment confirms that significant execution risks and operational hurdles are impeding the path to mainstream adoption.

2024: Volatile and Back‑Loaded Progress: PR–Commercial Gap Meets Year‑End Diversification

Quarterly Structured Analysis

Q1 2024

Emerging Themes and Technological Readiness: The quarter was dominated by public relations and discourse rather than concrete commercial progress. The key theme was ExxonMobil positioning itself within the clean tech space, particularly around DAC and CCS. However, no new commercial-scale projects, partnerships, or offtake agreements were announced.

Risk and Financial Viability Assessment: This quarter was marked by significant reputational and market risk. Public criticism emerged regarding a proposed CCS project in Montana. Furthermore, comments from ExxonMobil’s CEO questioning consumers’ willingness to pay for the energy transition sparked considerable backlash from climate experts in February and March, amplifying concerns about the company’s strategic commitment. These events, coupled with news of former political aides joining the company’s lobbying team, fueled skepticism.

Market Sentiment and PR vs. Commercial Activities: The Commercial Activity Chart shows a significant spike in PR activities, while commercial events remained at zero. This created the widest gap between rhetoric and action for the entire year. The Sentiment Chart mirrors this reality, showing a notable rise in negative sentiment during Q1. This indicates that the high volume of PR, unmatched by tangible commercial developments, was met with increasing public and market skepticism.

Q2 2024

Emerging Themes and Technological Readiness: Q2 marked a pivotal shift with the announcement of the year’s first major commercial agreements, signaling a move from discourse to execution. The dominant theme was the formation of strategic partnerships to build out the CCS and low-carbon value chain. Key developments included:
An agreement with Indonesia’s Pertamina to explore a joint CCS facility in May.
The awarding of a major Engineering, Procurement, and Construction (EPC) contract to Technip Energies and Turner Industries for a Louisiana CCS project in June.
A partnership with Air Liquide to support low-carbon hydrogen and ammonia production, also in June.
These events demonstrate tangible progress in building the infrastructure required for large-scale decarbonization.

Risk and Financial Viability Assessment: Despite commercial progress, risks persisted. In May, the company faced criticism over its legal actions against shareholders, which was viewed as an attempt to stifle climate-related resolutions. This action highlighted ongoing friction between the company’s management and a segment of its investor base.

Market Sentiment and PR vs. Commercial Activities: As seen in the Commercial Activity Chart, commercial events registered for the first time in 2024, beginning to close the significant gap with PR activities. While PR volume remained high, the emergence of three distinct commercial events signaled tangible momentum. The Sentiment Chart shows that despite this progress, positive sentiment continued to decline from its 2023 peak, likely weighed down by the shareholder controversy. The market appeared to be cautiously processing the new commercial deals against a backdrop of ongoing governance concerns.

Q3 2024

Emerging Themes and Technological Readiness: Q3 was a period of relative quiet on the commercial front, with a focus on longer-term technology development and policy shaping. Positive news centered on ExxonMobil’s messaging around the importance of DAC and research collaborations. No new major commercial agreements or project milestones were announced.

Risk and Financial Viability Assessment: An investigative report in August raised concerns about ExxonMobil’s extensive lobbying efforts and pursuit of government subsidies for CCS, which critics labeled as an ‘underperforming’ climate solution. This narrative posed a risk by potentially undermining the perceived environmental credibility and financial self-sufficiency of its projects.

Government Subsidies and Grants Analysis: Media reports highlighted the company’s strategy of chasing billions in U.S. government subsidies to support its CCS projects. This underscores the current reliance on policy incentives for the financial viability of these capital-intensive technologies.

Market Sentiment and PR vs. Commercial Activities: The Commercial Activity Chart shows a notable dip in both PR and commercial activities, with the latter returning to zero. This operational lull is reflected in the Sentiment Chart, where positive sentiment reached its lowest point for the year before beginning a slow recovery. Negative sentiment, having peaked, started to decline, suggesting the market was moving past the controversies of the first half of the year.

Q4 2024

Emerging Themes and Technological Readiness: The final quarter delivered a surge of significant commercial announcements, showcasing a diversification of ExxonMobil’s low-carbon strategy beyond traditional CCS. Key developments marking a strong finish to the year included:
Progress on a $400 million CCS expansion project in LaBarge, Wyoming, targeting a 2025 startup.
A partnership with NG3 to capture 1.2 million metric tons of CO2 annually.
A landmark non-binding MOU with LG Chem for a multi-year offtake of up to 100,000 metric tons of lithium, signaling entry into the battery materials supply chain.
A plan to construct a natural gas power plant with over 90% CO2 capture to supply electricity directly to data centers, a novel application addressing the energy needs of the AI boom.

Risk and Financial Viability Assessment: The announcement of an offtake agreement for lithium and a dedicated power project for data centers are strong indicators of market confidence and financial viability, moving beyond pure reliance on carbon credits or subsidies and into creating products for high-demand growth markets.

Market Sentiment and PR vs. Commercial Activities: PR activity rebounded strongly in Q4, but this time it was accompanied by high-impact commercial news, particularly the data center power plant announcement in December. Although only one major commercial event was logged in the chart data for Q4, its strategic importance was immense. The Sentiment Chart shows a sharp and significant rebound in positive sentiment, aligning directly with this flurry of positive, forward-looking announcements. The market reacted with optimism to the tangible and diversified commercial strategy that emerged at year-end.

Annual Pattern & Strategic Insights

Annual Commercialization Pattern Summary

The commercialization pattern for 2024 was volatile and back-loaded. The year began with a significant disconnect between PR and commercial reality, which attracted negative sentiment. Tangible activity was concentrated in two distinct bursts: **Q2**, which established key foundational partnerships for CCS, and **Q4**, the peak activity quarter, which revealed a more sophisticated and diversified strategy targeting new growth markets like battery materials and low-carbon power for data centers. The lull in Q3 represented a period of strategic consolidation before the year-end surge.

SWOT Analysis

Strengths: Demonstrated ability to execute large-scale CCS projects (Wyoming); capacity to form strategic global partnerships (Pertamina, Air Liquide); diversification into high-growth, synergistic markets (lithium, data center power).
Weaknesses: Persistent gap between PR and commercial execution for parts of the year; vulnerability to negative sentiment from executive statements and shareholder conflicts; reliance on government subsidies for core CCS project viability.
Opportunities: Meeting the surging, high-value energy demand from the AI and data center industry; capitalizing on government incentives (like the IRA) to de-risk investments; becoming a key supplier in the EV battery supply chain.
Threats: Public and regulatory opposition to CCS projects (Montana); shareholder activism targeting climate strategy and capital allocation; reputational damage from perceptions of greenwashing or lobbying against stronger climate action.

Segment-Specific Hypothesis Formulation

Based on the 2024 data, the following hypothesis is formulated for ExxonMobil’s Low-Carbon Solutions segment:

Negative or Cautious Market Hypothesis (Slow Adoption, Higher Risk):Persistent gaps between PR activities and actual commercial implementation, rising negative sentiment in the first half of the year driven by public criticism and shareholder friction, and a clear reliance on policy support indicate that while foundational work is underway, sustained challenges and market skepticism present risks to the pace of mainstream adoption for ExxonMobil’s low-carbon solutions.

2023: Year of Momentum: From Foundations to Breakout with Unwavering Positive Sentiment

Quarterly Structured Analysis

Q1 2023
Emerging Themes and Technological Readiness: The quarter was defined by early-stage, exploratory activities. The dominant theme was the formation of strategic partnerships to evaluate future projects, highlighted by an MOU with Mitsubishi and Nippon Steel for a CCS initiative. This points to a technology readiness level focused on feasibility assessment rather than immediate deployment.

Market Sentiment and PR vs Commercial Activities (Chart Analysis): A distinct gap between public relations and commercial execution was evident. The commercial events chart registered no activity, while low-volume PR was present. The sentiment chart reveals a strongly positive index with a complete absence of negative sentiment, indicating market optimism was rooted in future potential and strategic positioning.

Q2 2023
Emerging Themes and Technological Readiness: A clear progression from exploration to initial commercial agreements occurred. A key adoption signal was the CCS contract with steel manufacturer Nucor to capture and store 800,000 tons of CO2 annually. Furthermore, the decision to advance a proprietary DAC pilot project signaled growing confidence in in-house technology, complemented by a technology support order to FuelCell Energy, which demonstrated supply chain activation.

Market Sentiment and PR vs Commercial Activities (Chart Analysis): The gap between PR and commercial events widened as PR activity increased to reflect new agreements. However, the commercial events metric remained at zero, indicating these initial contracts, while significant, did not meet the chart’s threshold for a major project milestone. Despite this, stakeholder confidence held firm, with market sentiment remaining exclusively positive.

Q3 2023
Emerging Themes and Technological Readiness: Q3 was the pivotal quarter for commercialization, marked by landmark agreements and strategic infrastructure acquisition. A key development was the agreement with CF Industries to facilitate low-carbon ammonia production via CCS. Critically, winning a carbon storage license in the UK’s North Sea secured essential long-term capacity, a crucial step toward commercial scale.

Risk and Financial Viability Assessment: Financial commitment and de-risking were demonstrated through the announced acquisition of Denbury for $4.9 billion, a strategic move to secure control over significant CO2 pipeline infrastructure.
Government Subsidies and Grants Analysis: The market environment was significantly bolstered by the U.S. Department of Energy’s announcement of $1.2 billion for DAC hubs. This government backing served as powerful validation of the technology’s strategic importance and commercial path.

Market Sentiment and PR vs Commercial Activities (Chart Analysis): This quarter showed the strongest alignment between communication and action. The commercial events metric surged from zero to its annual peak, directly reflecting the new agreements and license award. This surge provided concrete evidence supporting the high positive sentiment and temporarily narrowed the gap between PR and tangible commercial progress.

Q4 2023
Emerging Themes and Technological Readiness: The final quarter was dominated by the finalization of the Denbury acquisition, cementing a leadership position in CCS infrastructure.

Risk and Financial Viability Assessment: Sector-wide confidence was boosted by BlackRock’s $550 million investment in a competitor’s DAC plant (Occidental’s Stratos). This investment from a leading financial institution signaled strong belief in the technology’s financial viability, creating positive tailwinds for the entire segment.

Market Sentiment and PR vs Commercial Activities (Chart Analysis): A stark divergence emerged. PR activities soared to their annual peak, driven by news of the major acquisition. In contrast, the commercial events metric fell back to zero, indicating that large-scale M&A was categorized as a PR event rather than a project-level milestone. This created the year’s widest gap between PR and charted commercial events, though overall sentiment remained undeterred and purely positive.

Annual Pattern & Strategic Insights

Annual Commercialization Pattern Summary

The commercialization pattern in 2023 was one of a concentrated surge rather than a steady ascent. The year was defined by a breakout in Q3, where foundational activities from H1 translated into landmark commercial agreements and infrastructure wins. A consistent theme was the complete absence of negative sentiment or reported setbacks, pointing to a highly positive market narrative throughout the year.

SWOT Analysis:

Strengths: Proven ability to execute high-volume industrial CCS contracts (Nucor), strategic M&A for critical infrastructure (Denbury), and securing government-issued licenses for future capacity (UK North Sea).
Weaknesses: Commercial progress appears dependent on large, infrequent deals, as shown by the singular peak in the commercial events chart. A persistent gap between high PR volume and tangible project milestones suggests many initiatives remain in pre-commercial phases.
Opportunities: Strong government support and funding for the sector (U.S. DOE’s $1.2B for DAC hubs), growing investor confidence from major financial institutions (BlackRock), and increasing demand from hard-to-abate industries.
Threats: No specific threats were identified in the 2023 data. The overwhelmingly positive data suggests a bullish year, though a reliance on a few large deals could present concentration risk if those projects were to face future delays.

Segment-Specific Hypothesis Formulation

Positive Market Hypothesis (Mainstream Adoption, Lower Risk): Positive sentiment, a Q3 surge in commercial agreements that temporarily narrowed the PR gap, strong policy support, and significant M&A activity suggest the Carbon Capture and Storage (CCS) & Direct Air Capture (DAC) segment is advancing toward mainstream adoption with reduced market risk.

Table: SWOT Analysis of ExxonMobil’s CCS Segment Evolution