Exxon Makes ‘Green’ Move With $5 Billion Purchase Of Denbury

Key Takeaways

• Exxon Mobil will be purchasing specialist oil and gas producer Denbury for $5 billion
• The key driver of the acquisition is Denbury’s 1,300 miles of CO2 pipeline, which will allow Exxon to bolster their carbon capture and storage business
• Carbon storage and carbon credits are becoming big business, with the Inflation Reduction Act including many tax incentives for companies

One of the biggest oil companies in the world, Exxon Mobil, is purchasing a company that specializes in operating pipeline transport carbon dioxide (CO2). It’s a bet on the future of carbon management and provides the company with the potential to capitalize on massive government tax incentive schemes.

The company in question, Denbury, has had a massive turnaround in recent years after coming out of bankruptcy in 2020. The $5 billion purchase price offered by Exxon is a slight bump for Denbury shareholders, with the market cap of the company at around $4.4 billion just prior to the announcement.