From Master Resource
By Robert Bradley Jr. — March 6, 2023
“After advertising its efforts to produce environmentally friendly fuels from algae for over a decade, Exxon Mobil Corp. is now quietly walking away from its most heavily publicized climate solution.” (below)
Biofuel is out, leaving carbon capture and storage (CCS) as the leave-us-alone, we-are-doing-our-part “greenwashing” strategy at ExxonMobil (see tomorrow’s post). The end of algae as a substitute for crude oil comes after $350 million and 14 years of commitment. This expenditure was joined by a “green” advertising campaign around the project of at least $60 million, mostly spent between 2017 and 2019.
It was predictable. Shell, BP, and Chevron had previously thrown in the biofuels towel. And it is reminiscent of Exxon’s failed ventures in the 1970s: Office equipment. Real estate. Synthetic fuels. Shale oil. Electric motors. Solar panels. Uranium. Copper.
Here is the latest as reported by Ben Eligin and Kevin Crowley. “Exxon Retreats From Major Climate Effort to Make Biofuels From Algae” (Reuters: February 10, 2023) is subtitled “Renewable fuels made from algae was the company’s most heavily publicized climate solution.” The three shutdowns are reported in the article:
Exxon has slashed its support for Viridos Inc., a biotech company based in La Jolla, California, that operated as the oil giant’s key technical partner since it began its algae push in 2009. With Exxon funding drying up and difficulty finding other backers, the biotech firm laid off 60% of its staff on Dec. 27, according to Viridos executives. The biotech company said it is still moving forward with algae research.
Exxon, meanwhile, has also halted funding for a multi-million-dollar algae project at the Colorado School of Mines at the end of last year, after supporting the work for eight years. Another Exxon-backed venture with the National Renewable Energy Laboratory is set to end within weeks.
But the company’s new division, Low Carbon Solutions (think Exxon Enterprises of the 1970s), soldiers on with government subsidies in tow:
Exxon confirmed that it’s pulling back on funding for algae in favor of other technologies now being worked on by its Low Carbon Solutions division. “At this point we have other programs that are ready for deployment,” said Vijay Swarup, Exxon’s senior director of technology who ran algae research. “We need to get on the deployment curve for carbon capture, for hydrogen, for biofuels. Algae still needs some more work.”
“It’s a remarkable shift for Exxon,” Eligin and Crowley continue:
The allure of biofuels made from algae is that they would potentially generate less than half the emissions of petroleum. The production and use of Exxon’s oil and gas ultimately generates about 630 million tons of heat-trapping gases each year, nearly equal to the carbon footprint of Canada. The green goop has for years been prominently featured as a climate-friendly possibility in television ads and investor presentations.
Exxon is retreating from algae despite a smashing financial performance last year, in which it posted a record-breaking $59 billion in profits. And it comes just as the algae research has shown significant progress: Viridos and Exxon achieved significant improvements in recent years, including a seven-fold increase in the productivity of algae grown in outdoor ponds, according to Viridos Chief Executive Officer Oliver Fetzer.
Some questionable editorializing here. Strong profits are not a reason to engage in loss economics, particularly with a technology that has never been profitable and has open-ended grim economics. And “getting better” … isn’t that the perennial cry for more subsidies, more time?
Algae has long played an intriguing role at Exxon. The company, more than any other, has received criticism for being the most recalcitrant on climate change, becoming the subject of lawsuits, protests and years of political scrutiny over its long-term commitment to fossil fuels even as global warming gathers pace. As criticism poured in, Exxon frequently held up its algae efforts as one significant piece of evidence that it was serious about climate change and discovering cleaner forms of energy. “They’ve been trying to create the impression that they’re part of the solution, when they’re certainly not,” said Robert Brulle, a visiting professor at Brown University who has studied the promotional activities of the fossil fuels industry.
ExxonMobil executives tried to appease their enemies, and this is what they get? It was all laid out by one Steve Milloy, who has actively urged the company’s executives not to try to appease their enemies but to stand proud for what they believe in: oil and gas for the masses. 
Eligin and Crowley end:
In an interview, Exxon officials rejected the suggestion that algae was some sort of greenwashing attempt. “The progress we’ve made to this point is remarkable,” Swarup said, adding that algae still has enormous future potential. “Where we are with the algae today is further along than, quite frankly, anyone has ever been with algae, in terms of productivity, in terms of the ability to replicate the results outdoors.”
Remarkable? Does the research and findings to date have any market value? Or was it just a wealth transfer to some academic researchers and expensive greenwashing? Lee Raymond would have never done it back when ExxonMobil was one of the best managed companies in the world.
The biofuels problem is one of energy density from which a lot of other problems emerge.  Crude oil remains king.
It can only be hoped that the mistakes of the present (algae yesterday, carbon capture tomorrow) can be lesson learned. Referring to the 1970s, Joseph Pratt and William Hale remarked:
Thinking that the oil industry might well be dying a slow death, Exxon and most major oil companies moved out of oil in search of opportunities for long-term growth. Exxon spent considerable capital, management effort, and research dollars on diversification into industries completely outside of energy, as well as into energy industries other than oil and gas.
Mistakes all, the company exited the businesses and “refocused its attentions on its core business: oil, natural gas, and chemicals [and] … emerged at the end with a sharper focus on its core businesses and a renewed sense that oil and gas would remain its priority well into the future.”  There is hope today–but carbon capture and storage remains as a Great Distraction at ExxonMobil. Bad PR from right and left, too.
 Milloy testified at the 2021 meeting:
At the 2008 annual meeting, I told then-CEO Rex Tillerson that appeasing climate activists would lead to disaster. I suggested a way out: Ban these stupid shareholder proposals. I delivered the same message to current CEO Darren Woods in 2017. He didn’t listen either…. This year I proposed that Exxon push back on climate idiocy by disclosing the actual costs and benefits of cutting emissions. The costs of emissions cuts, you see, are very high and the benefits are zero. But the ever-obtuse Mr. Woods refuses to acknowledge these realities.
 “The process requires vast amounts of energy so much so that algal biofuel production might consume more energy than it produces, some researchers concluded.” – Christopher Matthews, “Exxon Sees Green Gold In Algae-Based Fuels. Skeptics See Greenwashing” (Wall Street Journal, October 4, 2021)
 Pratt and Hale, Exxon: Transforming Energy, 1973–2005 (Austin: Briscoe Center for American History, 2013), p. 167.