Exxon, fighting climate change charges, plans fuel cell venture

Reuters News
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Posted: May 05, 2016 8:07 AM

By Ernest Scheyder

HOUSTON (Reuters) - Exxon Mobil Corp, which has been fighting accusations it misled investors and the public for years about the risks of climate change, said on Thursday it will expand a research project with FuelCell Energy Inc that aims to cut the cost of collecting carbon emissions from power plants.

The companies hope to use fuel cells, rather than exhaust scrubbers, the industry standard, to capture emissions from natural gas-fired plants and at the same time generate electricity. Scrubbers typically consume power as they filter carbon.

Exxon has announced several alternative energy projects in recent years. The company says the projects have nothing to do with recent public outcry over its climate change disclosures, but are part of research into carbon sequestration and alternative fuels.

Exxon, the largest natural gas producer in the United States, and FuelCell Energy declined to provide financial details of the project.

A fuel cell generates power from gas, hydrogen or other fuels and converts it to electricity.

Exxon investors and attorneys general around the United States have alleged the oil giant withheld internal studies on carbon emissions and global temperature change for decades.

Exxon has repeatedly denied the allegations. Vijay Swarup, Exxon's vice president for research and development, said the FuelCell Energy joint venture is not a reaction to public pressure.

"This is one component of a research portfolio that has been in place for several years," Swarup said.

FuelCell Energy, whose market value is less than 1 percent of Exxon's, said it will provide 15 to 20 scientists for the project, which will take place at the company's Danbury, Conn., headquarters.

Exxon said it would devote as many of its scientists as needed. Executives declined to provide a specific number.

Both companies will share patents on any developed technology.

FuelCell Energy, whose second-largest shareholder is utility NRG Energy Inc, makes small-scale power plants across the United States. Exxon contacted the company in 2011 to begin research, said Chip Bottone, FuelCell Energy's chief executive.

"It's critical that we have someone like Exxon, with their expertise, to create this market opportunity," said Bottone.

Exxon, which last week reported its smallest quarterly profit since 1999, sponsors other carbon and alternative energy projects.

Last year, Exxon gave $1 million to the Colorado School of Mines to study algal biofuels. In January, Exxon said it would partner with the Renewable Energy Group to find ways cellulosic sugars can be used to make biodiesel.

(Reporting by Ernest Scheyder; Editing by David Gregorio)