Eight major projects came online last year: Exxon Mobil

Exxon Mobil had been working for years on several new mega oil and gas projects in places such as Abu Dhabi, Russia, Papua New Guinea, and the Gulf of Mexico in a bid to turn around what had been a steady and worrying decline in oil and gas production, AP reported.

Exxon said yesterday that a record eight of those mega-project came on-line last year, just as oil prices were falling by more than half.

According to Fadel Gheit, an analyst at Oppenheimer & Co, investors would be more than happy to see production fall but oil prices higher.

The mega projects were conceived and started years ago, as prices were rising and were starting to produce oil and gas at a time the price of global crude had slumped due to rising supplies and weak growth in demand.

Exxon yesterday reported a 21 per cent fall in both revenue and profit for the fourth quarter due to lower oil prices. According to the  company, it earned $6.57 billion in the quarter, the lowest since the first quarter of 2010, on revenue of $87.28 billion. The company last year earned $8.35 billion on revenue of $110.86 billion.

Meanwhile, Bloomberg reported that Exxon, the worlds' largest oil producer by market value followed Chevron, ConocoPhillips and other oil titans in posting steep profit drops after a shale-driven supply glut hit crude prices. Lay-offs, drilling delays and over $40 billion in spending cuts had already been announced as oil firms scrambled to ensure they had enough cash on hand to continue shelling out dividends to investors.

According to Ed Cowart at Eagle Asset Management, the last thing any of these oil majors wanted to do was to cut dividend. He added it was so importatnt for Exxon to maintain dividends that the company would cut the chairman's pay before touching dividends.

Oil producers, drillers, equipment suppliers and steelmakers had cut tens of thousands of jobs after crude lost almost 60 per cent of its value in seven months, an oil market slump not seen since the 2008-09 financial crisis.

Chevron chairman and chief executive John Watson last week, warned of increased belt-tightening if the price decline worsened.