Exxon Mobil Corp., a key player in Equatorial Guinea’s oil sector for almost three decades, has announced its plans to withdraw from the country in the coming months, bringing to an end a significant era in the nation’s oil history.
The decision comes as Exxon Mobil intends to transfer its investments in Equatorial Guinea to the government during the second quarter of the year.
The company explained its commitment to ensuring a safe transition of operations and supporting those affected by the change.
Equatorial Guinea experienced a surge in oil production at the turn of the century, becoming one of the world’s prominent oil provinces following significant discoveries by Mobil Corp. in the mid-1990s. Exxon’s acquisition of Mobil in 1999 further boosted production.
However, over the years, the country’s oil output plummeted by more than 80% due to diminishing reserves and declining foreign investment.
Exxon Mobil’s decision aligns with its long-term strategic objectives, focusing on capitalizing on the most promising opportunities worldwide.
CEO Darren Woods has prioritized investments in regions like Guyana and the US Permian Basin, where growth potential and cost efficiency are more favorable.
The departure underscores the complex dynamics of oil investment, where companies assess risks related to regulatory environments and political stability.
Dr. Ken Medlock of Rice University’s Center for Energy Studies highlighted that escalating risks could prompt companies to seek better opportunities elsewhere.
The exit of Exxon Mobil represents a significant shift for Equatorial Guinea, which has long relied on oil revenue to drive economic growth.
While the country’s oil wealth once bolstered its GDP per capita, challenges remain in addressing social indicators and human rights issues, signaling a transformative period ahead as Equatorial Guinea navigates its post-oil future.
