Exxon Halts €100 Million Recycling Investments Due to EU Rules
(Bloomberg) -- Exxon Mobil Corp. is shelving investments in chemical recycling in Europe due to what the energy giant says are overly restrictive rules on plastics.
The company will pause until further notice €100 million ($118 million) of investments in recycling in Antwerp and Rotterdam, the European Union’s petroleum-trading heartland, Senior Vice President Jack Williams said in an interview.
The EU is under mounting pressure to cut red tape to help industries grappling with high energy prices and myriad regulations compete in the global arena. The bloc’s leadership in policies to fight climate change faces growing challenges following the return to the White House of President Donald Trump, who’s in the UK for his second state visit.
“I find that a bit ironic given the EU is really taking a leadership role in terms of decarbonization, and we have a whole business set up for just that, and yet we can’t find competitive investments to make in Europe,” said Williams, one of the top executives running Exxon with Chief Executive Officer Darren Woods. “We were excited to be able to deploy chemical recycling at Rotterdam and Antwerp and unfortunately, at this point, we can’t.”
Without changes to EU regulations, Exxon is unable to resume projects designed to recycle 80,000 metric tons of plastic waste annually, he added.
It’s the latest sign of industrial discontent with EU rules. The European Commission, the bloc’s executive branch, has embarked on a program to streamline bureaucracy and regulations, but it’s not going far enough, Williams said.
Mario Draghi, former European Central Bank President and architect of a landmark roadmap to boost the region’s competitiveness, said this week the EU was “failing to match the speed” of a changing global order. Just 11% of the ideas he outlined in a paper published last year have been implemented, according to the European Policy Innovation Council.
“Our efforts are focused on supporting the competitiveness of the chemicals and recycling industries, by focusing on circularity and embracing innovation,” Jessika Roswall, EU environment commissioner, said in response to questions. “We are working on a clear and science-based framework — to make sure chemical recycling is done properly.”
The EU says that traditional mechanical plastic recycling is “typically preferred” as it’s less polluting and more energy efficient. The problem with that approach is that a lot of harder-to-recycle plastics end up going to landfills, according to Exxon. Williams said the Texas-based company has embarked on several similar chemical recycling projects in the US.
In May, Exxon announced its intention to sell its controlling stake in the Gravenchon refinery in northern France, which accounts for about 20% of the country’s refining capacity. It sold another French refinery and announced the closure of some petrochemical production, also in France, in 2024. The company has also been trying to sell its stake in Germany’s biggest-oil processing complex.
Williams also said that the EU’s due diligence rules for companies, known as CSDDD, which are designed to clean up supply chains and mandates climate transition plans, should be scrapped. The bloc is currently trying to make it easier for companies to adhere to them.
Exxon’s public reprimand is unusual. Williams’s remarks may catch the attention of Trump, whose supporters have sought to tie CSDDD to trade negotiations between the US and Europe.
A framework trade agreement between the EU and the US published in August said the bloc will make efforts to ensure the directive doesn’t “pose undue restrictions on transatlantic trade.”
CSDDD “forces companies to commit to transition plans that aren’t achievable because the policies and the technologies quite frankly just aren’t available to transition to net zero scope 3 emissions for many industry sectors,” Williams said. “The only choice is to reduce or cease operations.”
Scope 3 refers to indirect greenhouse gas emissions that a company doesn’t control, such as products from suppliers.
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