The No. 1 producer of cheap single-use plastics (SUP) waste that is killing the world’s oceans, ExxonMobil reported a quarterly profit of almost $20 billion in October but the energy giant is suing the European Union (EU) to stop its new windfall tax on oil firms.
Energy firms are getting much more money for their oil and gas, partly due to supply concerns after Russia’s invasion of Ukraine.
Exxon Mobil’s U.S. oil refineries pump out far more lung-damaging soot than similarly-sized facilities operated by rivals, according to regulatory documents
In September, European Commission chief Ursula von der Leyen announced an emergency plan for major oil, gas and coal companies to pay a “crisis contribution” on their increased 2022 profits.
A 33% tax on this year’s profits was announced – those profits were more than 20% higher than the average for the three previous years.
Exxon has also argued that the levy undermines investor confidence, in a challenge filed at the EU’s Luxembourg-based General Court.
“Whether we invest here primarily depends on how attractive and globally competitive Europe will be,” Exxon spokesperson Casey Norton told the Reuters news agency.
In an investor meeting earlier this month, ExxonMobil’s chief financial officer estimated that the EU tax would cost the group “over $2 billion”.
The European Commission said it “takes note” of Exxon’s lawsuit.
An analysis by the Minderoo Foundation in Australia revealed that ExxonMobil contributed 5.9 million metric tons to global plastic waste, making the company the largest producer of single-use plastics.
Exxon Mobil’s U.S. oil refineries pump out far more lung-damaging soot than similarly-sized facilities operated by rivals, according to regulatory documents and a Reuters analysis of pollution test results.
The Texas-based firm’s three largest refineries – two in Texas and one in Louisiana – are the nation’s top three emitters of small particulate matter, according to the analysis of the latest tests submitted to regulators by the nation’s 10 largest refineries.
“Exxon has all the resources in the world to lower its pollution rates dramatically,” said Wilma Subra, a Louisiana-based scientist who formerly served on the Environmental Protection Agency’s National Environmental Justice Advisory Council.
U.S. oil major Exxon Mobil Corp is suing the European Union in a bid to force it to scrap the bloc’s new windfall tax on oil groups, arguing Brussels exceeded its legal authority by imposing the levy.
Record profits this year by oil companies benefiting from high energy prices have boosted inflation around the world and led to fresh calls to further tax the sector.
The windfall profits tax is “counter-productive,” discourages investments and undermines investor confidence, Exxon spokesperson Casey Norton said on Wednesday. Exxon will factor in the tax as it considers future multibillion-euro investments in Europe’s energy supply and transition, he said.
Windfall profit taxes imposed by Europe could cost at least $2 billion through the end of 2023, Chief Financial Officer Kathryn Mikells said in a call to analysts on Dec. 8.
Exxon said it invested $3 billion in the past decade in refinery projects in Europe. The projects are helping it deliver more energy products at a time when Europe struggles to reduce its imports from Russia, the company said.
“We will continue to work with EU leaders to address these issues. Thoughtful policy is critical,” the company said.
Chevron Corp had also warned that taxing oil production would serve only to reduce energy supply by discouraging company investments.
“That goes against the intent of increasing suppliers and making energy more affordable,” Chevron’s chief financial officer, Pierre Breber, told Reuters in October.