The largest U.S. oil producer said it expects to take a $2.4 billion to $2.6 billion impairment to oil and gas properties off the coast of Southern California.
"Continuing challenges in the state regulatory environment have impeded progress in restoring operations" at the company's Santa Ynez facilities near Santa Barbara, the company said. It had previously disclosed the properties would be sold for about $643 million in a highly-leveraged deal to a startup company.
The writedown marks a continuation of the exits by large oil companies from the state over the relatively mature oilfields and the state's environmental and regulatory policies.
Chevron in December blasted the state's energy policies as having "made it a difficult place to invest" and leading it "reduce spending by hundreds of millions of dollars since 2022."
Lower oil and gas prices last quarter will slash Exxon's operating profits, a preliminary release of operating results showed. Oil and gas earnings will fall by $400 million to $800 million for the last three months of 2023, compared with the third quarter.
The company posted $6.1 billion in upstream earnings for the third quarter ended Sept. 30.
Full results are expected on February 2.
Brent prices in the fourth quarter averaged $82.85, a 7% decrease compared to the same period last year and a 4% decline from the preceding third quarter.
The company's earnings per share are projected to be $2.09, according to 16 analysts consulted by financial firm LSEG, reflecting a 32% decrease from the year ago, and a 7% decrease from the third quarter.
