Oil major Exxon Mobil Corp said on Tuesday it bought a 49.9% stake in Norwegian biofuels company Biojet AS, as it looks to strengthen its low-carbon business to aide its targets for reducing greenhouse gas emissions.
Investors and governments have been mounting pressure on energy companies to fight climate change, worsened by carbon emissions from fossil fuels. In March, a hedge fund forced Exxon to add new board members who could help it confront the issue better.
The agreement will allow Exxon to purchase as much as 3 million barrels of Biojet’s biofuels per year. Biofuels can be used in passenger vehicles and heavy trucks.
Exxon did not immediately respond to Reuters’ request for financial details on the deal.
Biojet plans to develop up to five facilities to produce biofuels from forestry and wood-based construction waste, and expects commercial production to begin in 2025 at a manufacturing plant to be built in Follum, Norway.
Exxon said in December it aims to achieve net zero greenhouse gas (GHG) emissions from working assets in the U.S. Permian basin by 2030.