Exxon Mobil Corp 10-Q

ITEM 1. FINANCIAL STATEMENTS CONDENSED CONSOLIDATED STATEMENT OF INCOME (millions of dollars, unless noted) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Revenues and other income Sales and other operating revenue 111,265 65,943 198,999 123,495 Income from equity affiliates 3,688 1,436 6,226 2,909 Other income 728 363 956 485 Total revenues and other income 115,681 67,742 206,181 126,889 Costs and other deductions Crude oil and product purchases 65,613 37,329 118,001 69,930 Production and manufacturing expenses 10,686 8,471 20,927 16,533 Selling, general and administrative expenses 2,530 2,345 4,939 4,773 Depreciation and depletion (including impairments) 4,451 4,952 13,334 9,956 Exploration expenses, including dry holes 286 176 459 340 Non-service pension and postretirement benefit expense 120 162 228 540 Interest expense 194 254 382 512 Other taxes and duties 6,868 7,746 14,422 14,406 Total costs and other deductions 90,748 61,435 172,692 116,990 Income (loss) before income taxes 24,933 6,307 33,489 9,899 Income taxes 6,359 1,526 9,165 2,322 Net income (loss) including noncontrolling interests 18,574 4,781 24,324 7,577 Net income (loss) attributable to noncontrolling interests 724 91 994 157 Net income (loss) attributable to ExxonMobil 17,850 4,690 23,330 7,420 Earnings (loss) per common share (dollars) 4.21 1.10 5.49 1.74 Earnings (loss) per common share - assuming dilution (dollars) 4.21 1.10 5.49 1.74 The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. 3 CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net income (loss) including noncontrolling interests 18,574 4,781 24,324 7,577 Other comprehensive income (loss) (net of income taxes) Foreign exchange translation adjustment ( 2,537 ) 423 ( 1,796 ) 572 Postretirement benefits reserves adjustment (excluding amortization) 155 ( 47 ) 260 121 Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs 102 215 195 593 Total other comprehensive income (loss) ( 2,280 ) 591 ( 1,341 ) 1,286 Comprehensive income (loss) including noncontrolling interests 16,294 5,372 22,983 8,863 Comprehensive income (loss) attributable to noncontrolling interests 547 178 906 324 Comprehensive income (loss) attributable to ExxonMobil 15,747 5,194 22,077 8,539 The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. 4 CONDENSED CONSOLIDATED BALANCE SHEET (millions of dollars, unless noted) June 30, 2022 December 31, 2021 ASSETS Current assets Cash and cash equivalents 18,861 6,802 Notes and accounts receivable – net 48,063 32,383 Inventories Crude oil, products and merchandise 19,580 14,519 Materials and supplies 4,005 4,261 Other current assets 2,654 1,189 Total current assets 93,163 59,154 Investments, advances and long-term receivables 46,820 45,195 Property, plant and equipment – net 209,159 216,552 Other assets, including intangibles – net 18,632 18,022 Total Assets 367,774 338,923 LIABILITIES Current liabilities Notes and loans payable 7,367 4,276 Accounts payable and accrued liabilities 67,958 50,766 Income taxes payable 4,785 1,601 Total current liabilities 80,110 56,643 Long-term debt 39,516 43,428 Postretirement benefits reserves 17,408 18,430 Deferred income tax liabilities 20,807 20,165 Long-term obligations to equity companies 2,617 2,857 Other long-term obligations 22,808 21,717 Total Liabilities 183,266 163,240 Commitments and contingencies (Note 3) EQUITY Common stock without par value ( 9,000 million shares authorized, 8,019 million shares issued) 16,018 15,746 Earnings reinvested 407,902 392,059 Accumulated other comprehensive income ( 15,017 ) ( 13,764 ) Common stock held in treasury ( 3,851 million shares at June 30, 2022 and 3,780 million shares at December 31, 2021) ( 231,587 ) ( 225,464 ) ExxonMobil share of equity 177,316 168,577 Noncontrolling interests 7,192 7,106 Total Equity 184,508 175,683 Total Liabilities and Equity 367,774 338,923 The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. 5 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW (millions of dollars) Six Months Ended June 30, 2022 2021 CASH FLOW FROM OPERATING ACTIVITIES Net income (loss) including noncontrolling interests 24,324 7,577 Depreciation and depletion (including impairments) 13,334 9,956 Changes in operational working capital, excluding cash and debt ( 1,661 ) 1,573 All other items – net ( 1,246 ) ( 192 ) Net cash provided by operating activities 34,751 18,914 CASH FLOW FROM INVESTING ACTIVITIES Additions to property, plant and equipment ( 7,748 ) ( 5,147 ) Proceeds from asset sales and returns of investments 1,232 557 Additional investments and advances ( 643 ) ( 613 ) Other investing activities including collection of advances 150 132 Net cash used in investing activities ( 7,009 ) ( 5,071 ) CASH FLOW FROM FINANCING ACTIVITIES Additions to short-term debt — 9,662 Reductions in short-term debt ( 2,336 ) ( 18,000 ) Additions/(reductions) in debt with three months or less maturity 1,303 1,320 Contingent consideration payments ( 58 ) ( 28 ) Cash dividends to ExxonMobil shareholders ( 7,487 ) ( 7,441 ) Cash dividends to noncontrolling interests ( 123 ) ( 112 ) Changes in noncontrolling interests ( 697 ) ( 207 ) Common stock acquired ( 5,986 ) ( 1 ) Net cash used in financing activities ( 15,384 ) ( 14,807 ) Effects of exchange rate changes on cash ( 299 ) 65 Increase/(decrease) in cash and cash equivalents 12,059 ( 899 ) Cash and cash equivalents at beginning of period 6,802 4,364 Cash and cash equivalents at end of period 18,861 3,465 SUPPLEMENTAL DISCLOSURES Income taxes paid 5,545 2,079 Cash interest paid Included in cash flows from operating activities 352 466 Capitalized, included in cash flows from investing activities 388 313 Total cash interest paid 740 779 Noncash right of use assets recorded in exchange for lease liabilities Operating leases 1,039 511 Finance leases 656 55 The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. 6 CONDENSED CONSOLIDATED STATEMENT OF CHANGE IN EQUITY ExxonMobil Share of Equity (millions of dollars, unless noted) Common Stock Earnings Reinvested Accumulated Other Comprehensive Income Common Stock Held in Treasury ExxonMobil Share of Equity Non-controlling Interests Total Equity Balance as of March 31, 2021 15,884 382,953 ( 16,090 ) ( 225,773 ) 156,974 7,127 164,101 Amortization of stock-based awards 126 — — — 126 — 126 Other ( 4 ) — — — ( 4 ) 33 29 Net income (loss) for the period — 4,690 — — 4,690 91 4,781 Dividends - common shares — ( 3,721 ) — — ( 3,721 ) ( 60 ) ( 3,781 ) Other comprehensive income (loss) — — 504 — 504 87 591 Acquisitions, at cost — — — — — ( 293 ) ( 293 ) Dispositions — — — 2 2 — 2 Balance as of June 30, 2021 16,006 383,922 ( 15,586 ) ( 225,771 ) 158,571 6,985 165,556 Balance as of March 31, 2022 15,879 393,779 ( 12,914 ) ( 227,529 ) 169,215 7,311 176,526 Amortization of stock-based awards 143 — — — 143 — 143 Other ( 4 ) — — — ( 4 ) ( 15 ) ( 19 ) Net income (loss) for the period — 17,850 — — 17,850 724 18,574 Dividends - common shares — ( 3,727 ) — — ( 3,727 ) ( 63 ) ( 3,790 ) Other comprehensive income (loss) — — ( 2,103 ) — ( 2,103 ) ( 177 ) ( 2,280 ) Acquisitions, at cost — — — ( 4,059 ) ( 4,059 ) ( 588 ) ( 4,647 ) Dispositions — — — 1 1 — 1 Balance as of June 30, 2022 16,018 407,902 ( 15,017 ) ( 231,587 ) 177,316 7,192 184,508 Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Common Stock Share Activity (millions of shares) Issued Held in Treasury Outstanding Issued Held in Treasury Outstanding Balance as of March 31 8,019 ( 3,806 ) 4,213 8,019 ( 3,785 ) 4,234 Acquisitions — ( 45 ) ( 45 ) — — — Dispositions — — — — — — Balance as of June 30 8,019 ( 3,851 ) 4,168 8,019 ( 3,785 ) 4,234 The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. 7 CONDENSED CONSOLIDATED STATEMENT OF CHANGE IN EQUITY ExxonMobil Share of Equity (millions of dollars, unless noted) Common Stock Earnings Reinvested Accumulated Other Comprehensive Income Common Stock Held in Treasury ExxonMobil Share of Equity Non-controlling Interests Total Equity Balance as of December 31, 2020 15,688 383,943 ( 16,705 ) ( 225,776 ) 157,150 6,980 164,130 Amortization of stock-based awards 328 — — — 328 — 328 Other ( 10 ) — — — ( 10 ) 86 76 Net income (loss) for the period — 7,420 — — 7,420 157 7,577 Dividends - common shares — ( 7,441 ) — — ( 7,441 ) ( 112 ) ( 7,553 ) Other comprehensive income (loss) — — 1,119 — 1,119 167 1,286 Acquisitions, at cost — — — ( 1 ) ( 1 ) ( 293 ) ( 294 ) Dispositions — — — 6 6 — 6 Balance as of June 30, 2021 16,006 383,922 ( 15,586 ) ( 225,771 ) 158,571 6,985 165,556 Balance as of December 31, 2021 15,746 392,059 ( 13,764 ) ( 225,464 ) 168,577 7,106 175,683 Amortization of stock-based awards 281 — — — 281 — 281 Other ( 9 ) — — — ( 9 ) ( 1 ) ( 10 ) Net income (loss) for the period — 23,330 — — 23,330 994 24,324 Dividends - common shares — ( 7,487 ) — — ( 7,487 ) ( 123 ) ( 7,610 ) Other comprehensive income (loss) — — ( 1,253 ) — ( 1,253 ) ( 88 ) ( 1,341 ) Acquisitions, at cost — — — ( 6,126 ) ( 6,126 ) ( 696 ) ( 6,822 ) Dispositions — — — 3 3 — 3 Balance as of June 30, 2022 16,018 407,902 ( 15,017 ) ( 231,587 ) 177,316 7,192 184,508 Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Common Stock Share Activity (millions of shares) Issued Held in Treasury Outstanding Issued Held in Treasury Outstanding Balance as of December 31 8,019 ( 3,780 ) 4,239 8,019 ( 3,786 ) 4,233 Acquisitions — ( 71 ) ( 71 ) — — — Dispositions — — — — 1 1 Balance as of June 30 8,019 ( 3,851 ) 4,168 8,019 ( 3,785 ) 4,234 The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. 8 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Note 1. Basis of Financial Statement Preparation These unaudited condensed consolidated financial statements should be read in the context of the consolidated financial statements and notes thereto filed with the Securities and Exchange Commission in the Corporation's 2021 Annual Report on Form 10-K. In the opinion of the Corporation, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein. All such adjustments are of a normal recurring nature. Prior data has been reclassified in certain cases to conform to the current presentation basis. The Corporation's exploration and production activities are accounted for under the "successful efforts" method. Note 2. Russia In response to Russia’s military action in Ukraine, the Corporation announced in early 2022 that it plans to discontinue operations on the Sakhalin-1 project (“Sakhalin”) and develop steps to exit the venture. In light of this, an impairment assessment was conducted, and management determined that the carrying value of the asset group was not recoverable. As a result, the Corporation’s first quarter earnings included after-tax charges of $ 3.4 billion largely representing the impairment of its operations related to Sakhalin. On a before-tax basis, the charges amounted to $ 4.6 billion, substantially all of which is reflected in the line captioned “Depreciation and depletion (including impairments)” on the Condensed Consolidated Statement of Income. The Corporation's exit from the project would result in quantities estimated at 150 million oil-equivalent barrels no longer qualifying as proved reserves, which represented less than one percent of the Corporation's 18.5 billion oil-equivalent barrels of proved reserves at year-end 2021. 9 Note 3. Litigation and Other Contingencies Litigation A variety of claims have been made against ExxonMobil and certain of its consolidated subsidiaries in a number of pending lawsuits. Management has regular litigation reviews, including updates from corporate and outside counsel, to assess the need for accounting recognition or disclosure of these contingencies. The Corporation accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. The Corporation does not record liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is reasonably possible and which are significant, the Corporation discloses the nature of the contingency and, where feasible, an estimate of the possible loss. For purposes of our contingency disclosures, “significant” includes material matters, as well as other matters which management believes should be disclosed. ExxonMobil will continue to defend itself vigorously in these matters. Based on a consideration of all relevant facts and circumstances, the Corporation does not believe the ultimate outcome of any currently pending lawsuit against ExxonMobil will have a material adverse effect upon the Corporation's operations, financial condition, or financial statements taken as a whole. Other Contingencies The Corporation and certain of its consolidated subsidiaries were contingently liable at June 30, 2022, for guarantees relating to notes, loans and performance under contracts. Where guarantees for environmental remediation and other similar matters do not include a stated cap, the amounts reflect management’s estimate of the maximum potential exposure. These guarantees are not reasonably likely to have a material effect on the Corporation’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. June 30, 2022 (millions of dollars) Equity Company Obligations (1) Other Third-Party Obligations Total Guarantees Debt-related 1,138 144 1,282 Other 757 5,903 6,660 Total 1,895 6,047 7,942 (1) ExxonMobil share Additionally, the Corporation and its affiliates have numerous long-term sales and purchase commitments in their various business activities, all of which are expected to be fulfilled with no adverse consequences material to the Corporation’s operations or financial condition. The operations and earnings of the Corporation and its affiliates throughout the world have been, and may in the future be, affected from time to time in varying degree by political developments and laws and regulations, such as forced divestiture of assets; restrictions on production, imports and exports; price controls; tax increases and retroactive tax claims; expropriation of property; cancellation of contract rights; sanctions and environmental regulations. Both the likelihood of such occurrences and their overall effect upon the Corporation vary greatly from country to country and are not predictable. 10 Note 4. Other Comprehensive Income Information ExxonMobil Share of Accumulated Other Comprehensive Income (millions of dollars) Cumulative Foreign Exchange Translation Adjustment Postretirement Benefits Reserves Adjustment Total Balance as of December 31, 2020 ( 10,614 ) ( 6,091 ) ( 16,705 ) Current period change excluding amounts reclassified from accumulated other comprehensive income (1) 425 119 544 Amounts reclassified from accumulated other comprehensive income — 575 575 Total change in accumulated other comprehensive income 425 694 1,119 Balance as of June 30, 2021 ( 10,189 ) ( 5,397 ) ( 15,586 ) Balance as of December 31, 2021 ( 11,499 ) ( 2,265 ) ( 13,764 ) Current period change excluding amounts reclassified from accumulated other comprehensive income (1) ( 1,682 ) 245 ( 1,437 ) Amounts reclassified from accumulated other comprehensive income — 184 184 Total change in accumulated other comprehensive income ( 1,682 ) 429 ( 1,253 ) Balance as of June 30, 2022 ( 13,181 ) ( 1,836 ) ( 15,017 ) (1) Cumulative Foreign Exchange Translation Adjustment includes net investment hedge gain/(loss) net of taxes of $ 327 million and $ 135 million in 2022 and 2021, respectively. Amounts Reclassified Out of Accumulated Other Comprehensive Income - Before-tax Income/(Expense) (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs (Statement of Income line: Non-service pension and postretirement benefit expense) ( 132 ) ( 280 ) ( 252 ) ( 764 ) Income Tax (Expense)/Credit For Components of Other Comprehensive Income (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Foreign exchange translation adjustment ( 68 ) 19 ( 90 ) ( 34 ) Postretirement benefits reserves adjustment (excluding amortization) ( 83 ) 25 ( 123 ) ( 33 ) Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs ( 30 ) ( 65 ) ( 57 ) ( 171 ) Total ( 181 ) ( 21 ) ( 270 ) ( 238 ) 11 Note 5. Earnings Per Share Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Earnings per common share Net income (loss) attributable to ExxonMobil (millions of dollars) 17,850 4,690 23,330 7,420 Weighted average number of common shares outstanding (millions of shares) 4,233 4,276 4,248 4,274 Earnings (loss) per common share (dollars) (1) 4.21 1.10 5.49 1.74 Dividends paid per common share (dollars) 0.88 0.87 1.76 1.74 (1) The calculation of earnings (loss) per common share and earnings (loss) per common share – assuming dilution are the same in each period shown. Note 6. Pension and Other Postretirement Benefits (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Components of net benefit cost Pension Benefits - U.S. Service cost 177 208 356 433 Interest cost 129 140 258 279 Expected return on plan assets ( 140 ) ( 181 ) ( 280 ) ( 361 ) Amortization of actuarial loss/(gain) 39 61 78 122 Amortization of prior service cost ( 7 ) ( 6 ) ( 14 ) ( 12 ) Net pension enhancement and curtailment/settlement cost 53 95 90 393 Net benefit cost 251 317 488 854 Pension Benefits - Non-U.S. Service cost 145 198 295 393 Interest cost 157 135 317 265 Expected return on plan assets ( 207 ) ( 263 ) ( 420 ) ( 521 ) Amortization of actuarial loss/(gain) 47 107 94 215 Amortization of prior service cost 11 14 23 29 Net pension enhancement and curtailment/settlement cost ( 1 ) — ( 1 ) 12 Net benefit cost 152 191 308 393 Other Postretirement Benefits Service cost 38 46 78 95 Interest cost 53 55 108 111 Expected return on plan assets ( 4 ) ( 4 ) ( 7 ) ( 9 ) Amortization of actuarial loss/(gain) — 19 3 38 Amortization of prior service cost ( 10 ) ( 10 ) ( 21 ) ( 21 ) Net benefit cost 77 106 161 214 12 Note 7. Financial Instruments and Derivatives The estimated fair value of financial instruments and derivatives at June 30, 2022 and December 31, 2021, and the related hierarchy level for the fair value measurement was as follows: June 30, 2022 Fair Value (millions of dollars) Level 1 Level 2 Level 3 Total Gross Assets & Liabilities Effect of Counterparty Netting Effect of Collateral Netting Difference in Carrying Value and Fair Value Net Carrying Value Assets Derivative assets (1) 6,269 2,935 — 9,204 ( 7,954 ) ( 209 ) — 1,041 Advances to/receivables from equity companies (2)(6) — 2,511 5,017 7,528 — — 666 8,194 Other long-term financial assets (3) 1,166 — 1,017 2,183 — — 188 2,371 Liabilities Derivative liabilities (4) 6,278 3,921 — 10,199 ( 7,954 ) ( 218 ) — 2,027 Long-term debt (5) 34,229 61 5 34,295 — — 2,935 37,230 Long-term obligations to equity companies (6) — — 2,635 2,635 — — ( 18 ) 2,617 Other long-term financial liabilities (7) — — 742 742 — — 51 793 December 31, 2021 Fair Value (millions of dollars) Level 1 Level 2 Level 3 Total Gross Assets & Liabilities Effect of Counterparty Netting Effect of Collateral Netting Difference in Carrying Value and Fair Value Net Carrying Value Assets Derivative assets (1) 1,422 1,523 — 2,945 ( 1,930 ) ( 28 ) — 987 Advances to/receivables from equity companies (2)(6) — 3,076 5,373 8,449 — — ( 123 ) 8,326 Other long-term financial assets (3) 1,134 — 1,058 2,192 — — 181 2,373 Liabilities Derivative liabilities (4) 1,701 2,594 — 4,295 ( 1,930 ) ( 306 ) — 2,059 Long-term debt (5) 44,454 88 3 44,545 — — ( 2,878 ) 41,667 Long-term obligations to equity companies (6) — — 3,084 3,084 — — ( 227 ) 2,857 Other long-term financial liabilities (7) — — 902 902 — — 58 960 (1) Included in the Balance Sheet lines: Notes and accounts receivable - net and Other assets, including intangibles - net (2) Included in the Balance Sheet line: Investments, advances and long-term receivables (3) Included in the Balance Sheet lines: Investments, advances and long-term receivables and Other assets, including intangibles - net (4) Included in the Balance Sheet lines: Accounts payable and accrued liabilities and Other long-term obligations (5) Excluding finance lease obligations (6) Advances to/receivables from equity companies and long-term obligations to equity companies are mainly designated as hierarchy level 3 inputs. The fair value is calculated by discounting the remaining obligations by a rate consistent with the credit quality and industry of the company. (7) Included in the Balance Sheet line: Other long-term obligations. Includes contingent consideration related to a prior year acquisition where fair value is based on expected drilling activities and discount rates. At June 30, 2022 and December 31, 2021, respectively, the Corporation had $ 1,403 million and $ 641 million of collateral under master netting arrangements not offset against the derivatives on the Consolidated Balance Sheet, primarily related to initial margin requirements. The Corporation may use non-derivative financial instruments, such as its foreign currency-denominated debt, as hedges of its net investments in certain foreign subsidiaries. Under this method, the change in the carrying value of the financial instruments due to foreign exchange fluctuations is reported in accumulated other comprehensive income. As of June 30, 2022, the 13 Corporation has designated $ 4.7 billion of its Euro-denominated long-term debt and related accrued interest as a net investment hedge of its European business. The net investment hedge is deemed to be perfectly effective. The Corporation had undrawn short-term committed lines of credit of $ 10.6 billion, of which $ 10 billion will expire without renewal in the third quarter, and undrawn long-term committed lines of credit of $ 0.4 billion as of second quarter 2022. Derivative Instruments The Corporation’s size, strong capital structure, geographic diversity and the complementary nature of our business segments reduce the Corporation’s enterprise-wide risk from changes in commodity prices, currency rates and interest rates. In addition, the Corporation uses commodity-based contracts, including derivatives, to manage commodity price risk and to generate returns from trading. Commodity contracts held for trading purposes are presented in the Condensed Consolidated Statement of Income on a net basis in the line “Sales and other operating revenue". The Corporation’s commodity derivatives are not accounted for under hedge accounting. At times, the Corporation also enters into currency and interest rate derivatives, none of which are material to the Corporation’s financial position as of June 30, 2022 and December 31, 2021, or results of operations for the periods ended June 30, 2022 and 2021. Credit risk associated with the Corporation’s derivative position is mitigated by several factors, including the use of derivative clearing exchanges and the quality of and financial limits placed on derivative counterparties. The Corporation maintains a system of controls that includes the authorization, reporting and monitoring of derivative activity. The net notional long/(short) position of derivative instruments at June 30, 2022 and December 31, 2021, was as follows: (millions) June 30, 2022 December 31, 2021 Crude oil (barrels) 47 82 Petroleum products (barrels) ( 39 ) ( 48 ) Natural gas (MMBTUs) ( 115 ) ( 115 ) Realized and unrealized gains/(losses) on derivative instruments that were recognized in the Condensed Consolidated Statement of Income are included in the following lines on a before-tax basis: (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Sales and other operating revenue ( 1,413 ) ( 1,088 ) ( 3,948 ) ( 1,600 ) Crude oil and product purchases — ( 20 ) ( 26 ) ( 19 ) Total ( 1,413 ) ( 1,108 ) ( 3,974 ) ( 1,619 ) Note 8. Disclosures about Segments and Related Information Effective April 1, 2022, the Corporation streamlined its business structure by combining the Chemical and Downstream businesses into a single business, Product Solutions. Product Solutions consists of three operating segments: • Energy Products: Fuels, aromatics, and catalysts and licensing • Chemical Products: Olefins, polyethylene, polypropylene, and intermediates • Specialty Products: Finished lubricants, basestocks and waxes, synthetics, and elastomers and resins Information disclosed in this note has been recast for the new segmentation. 14 (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Earnings (Loss) After Income Tax Upstream United States 3,749 663 6,125 1,026 Non-U.S. 7,622 2,522 9,734 4,713 Energy Products United States 2,655 ( 278 ) 3,144 ( 510 ) Non-U.S. 2,617 ( 578 ) 1,933 ( 1,267 ) Chemical Products United States 625 1,149 1,395 1,803 Non-U.S. 450 1,051 1,086 1,788 Specialty Products United States 232 262 478 442 Non-U.S. 185 487 415 862 Corporate and Financing ( 286 ) ( 588 ) ( 980 ) ( 1,437 ) Corporate total 17,850 4,690 23,330 7,420 Sales and Other Operating Revenue Upstream United States 3,958 1,726 6,614 3,611 Non-U.S. 7,101 3,792 13,444 6,886 Energy Products United States 34,473 18,770 59,326 34,304 Non-U.S. 52,804 29,925 94,519 56,815 Chemical Products United States 3,180 3,035 6,274 5,533 Non-U.S. 4,497 4,244 8,994 7,985 Specialty Products United States 1,653 1,242 3,044 2,379 Non-U.S. 3,591 3,204 6,769 6,073 Corporate and Financing 8 5 15 ( 91 ) Corporate total (1) 111,265 65,943 198,999 123,495 Intersegment Revenue Upstream United States 7,180 3,827 13,371 7,150 Non-U.S. 13,533 7,747 24,368 14,564 Energy Products United States 8,348 4,102 15,197 7,263 Non-U.S. 10,848 5,186 19,610 10,085 Chemical Products United States 2,558 1,461 4,325 2,806 Non-U.S. 1,600 929 3,107 1,751 Specialty Products United States 713 584 1,272 1,080 Non-U.S. 195 160 419 320 Corporate and Financing 59 52 116 109 (1) See footnote on the next page 15 Geographic Sales and Other Operating Revenue (millions of dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 United States 43,264 24,773 75,258 45,827 Non-U.S. 68,001 41,170 123,741 77,668 Total (1) 111,265 65,943 198,999 123,495 Significant Non-U.S. revenue sources include: (2) Canada 9,642 5,282 16,638 9,541 United Kingdom 8,306 3,815 15,854 6,758 France 5,265 3,247 9,622 6,029 Singapore 4,774 3,515 9,096 6,950 Italy 3,063 2,466 5,898 4,331 Belgium 3,041 2,192 5,877 4,181 Australia 3,205 2,019 5,661 3,748 (1) Includes approximately 23 % and 15 % related to revenue outside the scope of ASC 606 "Revenue from Contracts with Customers" for the three months ended June 30, 2022 and June 30, 2021, respectively, and 22 % and 16 % for the six months ended June 30, 2022 and June 30, 2021, respectively. Trade receivables in Notes and accounts receivable – net reported on the Balance Sheet include both receivables within the scope of ASC 606 and those outside the scope of ASC 606. Revenue and receivables outside the scope of ASC 606 primarily relate to physically settled commodity contracts accounted for as derivatives. Credit quality and type of customer are generally similar between those revenues and receivables within the scope of ASC 606 and those outside it. (2) Revenue is determined by primary country of operations. Excludes certain sales and other operating revenues in Non-U.S. operations where attribution to a specific country is not practicable. 16 Note 9. Divestment Activities In February 2022, the Corporation signed an agreement with Seplat Energy Offshore Limited for the sale of Mobil Producing Nigeria Unlimited. The agreement is subject to certain conditions precedent and government approvals. In early July, a Nigerian court issued an order to halt transition activities and enter into arbitration with the Nigerian National Petroleum Company. The closing date and any loss on sale will depend on resolution of these matters. In May 2022, the Corporation signed an agreement for the sale of ExxonMobil Exploration and Production Romania, consisting of certain unproved Upstream assets, to Romgaz S.A. The transaction closed in the third quarter, and the Corporation will recognize a gain on the sale of approximately $ 300 million. In June 2022, the Corporation signed an agreement with Whitecap Resources Inc. for the sale of XTO Energy Canada, consisting of Upstream unconventional assets in central Alberta. The agreed sales price is subject to interim period adjustments from May 1, 2022 to the closing date. The transaction is anticipated to close in the third quarter, and the Corporation expects to recognize a gain on the sale of approximately $ 300 million. 17