An unidentified unit of ExxonMobil Corporation (XOM) recently broke down, flaring up its Los Angeles area refinery in Torrance, California.
An equipment failure triggered off the trouble but operations have resumed and the company expects to meet its contractual commitments on time. The Torrance refinery spreads over 750 acres and employs nearly 800 people.
ExxonMobil’s capacity includes processing 149,500 barrels of crude oil per day and production of 1.8 billion gallons of gasoline per year. Other products of the refining process include liquefied petroleum gases, diesel fuel, petroleum coke and sulfur. The company also supplies jet fuel to Los Angeles International Airport via pipeline.
ExxonMobil is the world’s largest publicly traded oil company, engaged in the exploration and production of oil and natural gas, refining and marketing of petroleum products, manufacturing of chemicals, and other energy-related businesses. The company divides its operations in three segments: Upstream, Downstream and Chemicals.
It is the best-run integrated oil company in the world given its track record of superior return on capital employed. In fact, ExxonMobil has long been a core holding for investors seeking a defensive name with continued dividend growth.
However, as access to new energy resources becomes more difficult, ExxonMobil, like most of its peers, will face headwinds to replace its reserve. Given its large base, achieving growth in oil and natural gas production has been a challenge for the company over the last several years. With the established oil producing regions of Europe and North America well beyond their prime, the search for growth has pushed ExxonMobil into riskier regions.
ExxonMobil holds a Zacks #3 Rank, which is equivalent to a Hold rating for a period of one to three months. For the long term, we remain Neutral on the company. ExxonMobil faces tough competition from Chevron Corporation (CVX) and ConocoPhillips (COP).
CONOCOPHILLIPS (COP): Free Stock Analysis Report
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EXXON MOBIL CRP (XOM): Free Stock Analysis Report
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