Exxon Mobil‘s global oil and gas reserves tumbled by a third last year as the COVID-19 pandemic crashed global oil prices and demand, the company said on Wednesday.
The largest U.S. oil producer is reeling from the sharp decline in oil demand and a series of bad bets on projects when prices were much higher. It slashed project spending by a third last year, cut jobs and added to debt to cover its dividend.
The reserves reductions were “a result of very low prices during 2020 and the effects of reductions in capital expenditures,” the company said in a filing.
Total reserves for all products fell to 15.2 billion barrels of oil and gas at the end of 2020 from 22.4 billion the year before, mostly driven by oil sands in Canada and U.S. shale gas properties, according to a regulatory filing.
The plunge in the value of oil and gas properties was worse than during the 2014 through 2016 downturn, when Exxon had a 4.8 billion cut in its reserves.
The number of Exxon workers at the end of the year was 72,000, down from 74,900 at the end of 2019. Exxon has said it could cut 14,000 employees, or 15% of its global workforce, by the end of 2021.
It reported a net annual loss of $22.4 billion for 2020 compared with a full-year profit of $14.34 billion in 2019. Exxon churned out profits since it merged with Mobil in 1999 and through the 1980s oil bust.
Shares rose 3% on Wednesday to $56.70. (Reporting by Jennifer Hiller and Shariq A. Khan; Editing by Leslie Adler and Lincoln Feast.)
