- Exxon Mobil Corp (NYSE:XOM) has expressed preliminary interest in Denbury Inc (NYSE:DEN). No final decision has been made, and Exxon could opt against proceeding with a potential deal.
- If it goes through, it would be the biggest carbon-management investment since the Inflation Reduction Act was passed in August, Bloomberg reported, providing significant tax incentives for burying carbon dioxide.
- Carbon capture is the bedrock of Exxon’s climate strategy, which aims to eliminate its operational emissions by 2050.
- Denbury’s 1,300 miles of pipelines in the Gulf Coast and the Rocky Mountains dedicated to transporting carbon dioxide would give Exxon critical and hard-to-replicate infrastructure.
- Denbury is working with an adviser to explore a sale, Bloomberg reported in August. The company exited bankruptcy in 2020.
- Earlier this year, Exxon announced its plans to spend $15 billion on lower-carbon investments through 2027, with carbon capture as a priority, the report added.
- Denbury’s Rocky Mountain assets are connected to Exxon’s Shute Creek gas facility near LaBarge, Wyoming, which has captured more carbon than any other asset in the US.
- Price Action: DEN shares closed at $99.10 on Monday. XOM stock is down 2.24% at $96.63 during the premarket session on the last check Tuesday.
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