What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-08-01 compared with 2023-05-02 · 192 added, 62 removed, 248 unchanged (51% of the section changed)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

During the first quarter of 2023 the price of crude oil decreased as the global oil market saw higher inventory levels;

however prices remained above the 10-year average (2010-2019).

The increase in inventory levels was followed by an early April announcement from OPEC+ oil producers to further reduce oil output.

Natural gas prices remained above the 10-year range, despite declining significantly in the quarter as milder weather eased demand for natural gas heating, allowing storage levels to increase above historical averages in the United States and Europe.

While moderating slightly from the fourth quarter of 2022, refining margins remained above the 10-year range due to low inventory levels of petroleum products.

While chemical margins remained below the 10-year range due to continued bottom-of-cycle conditions in Asia Pacific, margins in North America improved on lower energy and feed costs.

The Corporation’s first quarter results include after-tax charges of $0.2 billion related to additional European taxes imposed on the energy sector, mainly reflected in the line “Income tax expense (benefit).” The enactment of regulations in late 2022 by European Member States and other countries imposed mandatory taxes on certain companies active in the crude petroleum, coal, natural gas, and refinery sectors.

During the first quarter of 2023, the price of crude oil declined towards the average of the 10-year range (2010-2019), impacted by higher inventory levels.

Crude oil prices were relatively flat in the second quarter after OPEC+ oil producers further reduced oil output, which helped offset concerns over potential market impacts from a weakening global economy.

Natural gas prices remained above the 10-year average despite declining significantly in the first half.

Storage levels increased above historical averages in the United States and Europe on higher supply and lower demand.

Refining margins declined on easing supply concerns with stabilization of Russian supply, yet remain above the 10-year average.

Chemical margins remained well below the 10-year range due to continued bottom-of-cycle conditions in Asia Pacific;

however, global margins improved in the second quarter on lower feed costs.

The Corporation’s first half results included after-tax charges of $0.2 billion related to additional European taxes imposed on the energy sector, mainly reflected in the line “Income tax expense (benefit).” The enactment of regulations in late 2022 by European Member States and other countries imposed mandatory taxes on certain companies active in the crude petroleum, coal, natural gas, and refinery sectors.

Denbury Acquisition

On July 13, 2023, the Corporation announced that it had entered into a definitive agreement to acquire Denbury Inc.

The acquisition further accelerates the Corporation’s Low Carbon Solutions opportunities.

See Note 10 of the Condensed Consolidated Financial Statements for additional information.

FUNCTIONAL EARNINGS SUMMARY

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Three Months Ended

March 31, 2023 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total

June 30, 2023 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total

(millions of dollars) U.S.

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Three Months Ended

March 31, 2022 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total

June 30, 2022 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total

(millions of dollars) U.S.

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Identified Items

Gain/(loss) on sale of assets 299 — — — — — — — — 299

Earnings (loss) excluding Identified Items (Non-GAAP)

3,450 7,622 2,655 2,617 625 450 232 185 (286) 17,551

Six Months Ended

June 30, 2023 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total

(millions of dollars) U.S.

Earnings (loss) (U.S.

2,552 8,482 3,438 3,055 810 389 824 621 (861) 19,310

Identified Items

Tax-related items — (170) — (12) — — — — — (182)

Earnings (loss) excluding Identified Items (Non-GAAP)

2,552 8,652 3,438 3,067 810 389 824 621 (861) 19,492

Six Months Ended

June 30, 2022 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total

(millions of dollars) U.S.

Earnings (loss) (U.S.

6,125 9,734 3,144 1,933 1,395 1,086 478 415 (980) 23,330

Identified Items

Impairments — (2,877) — — — — — — (98) (2,975)

Gain/(loss) on sale of assets 299 — — — — — — — — 299

Other — (378) — — — — — — — (378)

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Due to rounding, numbers presented may not add up precisely to the totals indicated.

REVIEW OF FIRST QUARTER 2023 RESULTS

ExxonMobil’s first quarter 2023 earnings were $11.4 billion, or $2.79 per share assuming dilution, compared with earnings of $5.5 billion a year earlier.

The increase in earnings was driven by higher Energy Products and Specialty Products margins as well as increased volume and improved mix.

Capital and exploration expenditures were $6.4 billion, up $1.5 billion from first quarter 2022.

REVIEW OF SECOND QUARTER 2023 RESULTS

ExxonMobil’s second-quarter 2023 earnings were $7.9 billion, or $1.94 per share assuming dilution, compared with earnings of $17.9 billion a year earlier.

The decrease in earnings was driven by lower crude and natural gas prices, and declining industry refining margins.

Capital and exploration expenditures were $6.2 billion, up $1.6 billion from second quarter 2022.

Earnings for the first six months of 2023 were $19.3 billion, or $4.73 per diluted share, compared with $23.3 billion a year earlier.

Capital and exploration expenditures were $12.5 billion, up $3.0 billion from 2022.

The Corporation distributed $7.4 billion in dividends to shareholders and repurchased $8.7 billion of common stock.

Upstream Financial Results

(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Earnings (loss) (U.S.

United States 920 3,749 2,552 6,125

3,657 7,622 8,482 9,734

Total 4,577 11,371 11,034 15,859

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United States 920 3,450 2,552 5,826

3,669 7,622 8,652 12,989

Total 4,589 11,072 11,204 18,815

Upstream First Quarter Earnings Factor Analysis

Upstream Second Quarter Earnings Factor Analysis

(millions of dollars)

Price – Price impacts, driven by a 23% decrease in average crude realizations, decreased earnings by $1,750 million.

Volume/Mix – Higher production volumes increased earnings by $620 million.

Advantaged projects growth in Guyana and Permian more than offset the impact from divestments and the Russia expropriation.

Identified Items (1) – 1Q 2022 $(3,255) million loss as a result of the Russia expropriation.

1Q 2023 $(158) million loss from additional European taxes.

Price – Price impacts decreased earnings by $6,300 million, driven by a 33% decrease in average crude realizations and 51% decrease in average natural gas realizations.

Volume/Mix – Lower volumes decreased earnings by $150 million, mainly driven by natural gas, partly offset by liquids growth in Guyana and the Permian.

Other – All other items decreased earnings by $30 million.

Identified Items (1) – 2Q 2022 $299 million gain on the sale of U.S.

Barnett Shale assets.

2Q 2023 $(12) million loss driven by additional European taxes.

(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items.

Upstream Year-to-Date Earnings Factor Analysis

(millions of dollars)

Price – Price impacts decreased earnings by $8,110 million, driven by a 28% decrease in average realizations for crude oil and a 27% decrease in average natural gas realizations.

Volume/Mix – Favorable volume and mix effects increased earnings by $520 million, driven by higher production from our advantaged projects in Guyana and the Permian.

Other – All other items decreased earnings by $20 million.

Identified Items (1) – 2022 $(2,956) million loss as a result of the Russia expropriation, partly offset by a gain on the sale of U.S.

Barnett Shale assets.

2023 $(170) million loss driven by additional European taxes.

(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items.

Upstream Operational Results

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Net production of crude oil, natural gas liquids, bitumen and synthetic oil

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Canada/Other Americas 618 556 645 516

Europe 4 4 4 4

Africa 206 224 213 240

Asia 702 691 725 714

Australia/Oceania 38 46 35 43

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(thousands of oil-equivalent barrels daily)

3,608 3,732 3,719 3,704

(1) Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels.

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(thousands of barrels daily) Three Months Ended

March 31, 2023

June 30 Six Months Ended

Volumes reconciliation (Oil-equivalent production) (1)

2022 3,732 3,704

Entitlements - Net Interest (26) (46)

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Growth / Other 24 163

2023 3,608 3,719

(1) Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels.

3.8 million oil-equivalent barrels per day in 1Q 2023 increased 156 thousand oil-equivalent barrels per day from 1Q 2022.

Growth in Guyana and the Permian more than offset the impacts from divestments and the Russia expropriation.

1Q 2023 production also benefited from lower downtime and higher entitlements due to lower prices.

3.6 million oil-equivalent barrels per day in 2Q 2023 decreased 124 thousand oil-equivalent barrels per day from 2Q 2022.

Net production increased 24 thousand oil-equivalent barrels per day, excluding the impacts from entitlements, divestments, the Russia expropriation, and higher government-mandated curtailments.

3.7 million oil-equivalent barrels per day in 2023 increased 15 thousand oil-equivalent barrels per day from 2022.

Net production increased 163 thousand oil-equivalent barrels per day driven by growth in Guyana and Permian, excluding the impacts from entitlements, divestments, the Russia expropriation, and higher government-mandated curtailments.

Listed below are descriptions of ExxonMobil’s volumes reconciliation factors which are provided to facilitate understanding of the terms.

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Such factors can also include other temporary changes in net interest as dictated by specific provisions in production agreements.

Government Mandates are changes to ExxonMobil's sustainable production levels as a result of temporary non-operational production limits or sanctions imposed by governments, generally upon a country, sector, type or method of production.

Government Mandates are changes to ExxonMobil's sustainable production levels as a result of production limits or sanctions imposed by governments.

Divestments are reductions in ExxonMobil’s production arising from commercial arrangements to fully or partially reduce equity in a field or asset in exchange for financial or other economic consideration.

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(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Earnings (loss) (U.S.

United States 1,528 2,655 3,438 3,144

782 2,617 3,055 1,933

Total 2,310 5,273 6,493 5,077

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United States — — — —

Total 18 — (12) —

Earnings (loss) excluding Identified Items (1) (Non-GAAP)

United States 1,528 2,655 3,438 3,144

764 2,617 3,067 1,933

Total 2,292 5,273 6,505 5,077

Due to rounding, numbers presented may not add up precisely to the totals indicated.

Energy Products First Quarter Earnings Factor Analysis

Energy Products Second Quarter Earnings Factor Analysis

(millions of dollars)

Margins – Higher margins increased earnings by $4,520 million due to stronger industry refining margins, as well as marketing and trading contributions.

Volume/Mix – Favorable volume and mix impacts partly offset by increased scheduled maintenance increased earnings by $150 million.

Other – All other items, including higher maintenance costs, decreased earnings by $260 million.

Identified Items (1) – 1Q 2023 $(30) million loss from additional European taxes.

Margins – Lower margins decreased earnings by $3,100 million due to lower industry refining margins, partly offset by increased marketing and trading contributions.

Volume/Mix – Favorable volume and mix increased earnings by $90 million, driven by the Beaumont refinery expansion.

Other – All other items increased earnings by $30 million.

Identified Items (1) – 2Q 2023 $18 million gain related to European taxes.

(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items.

Energy Products Year-to-Date Earnings Factor Analysis

(millions of dollars)

Margins – Margins increased earnings by $1,370 million as higher marketing and trading contributions more than offset declining industry refining margins.

Volume/Mix – Favorable volume and mix effects increased earnings by $290 million, including start-up of the Beaumont refinery expansion.

Other – All other items decreased earnings by $230 million, primarily due to higher project and maintenance expenses.

Identified Items (1) – 2023 $(12) million loss from additional European taxes.

(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items.

Energy Products Operational Results

(thousands of barrels daily) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Refinery throughput

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United States 2,743 2,452 2,601 2,358

2,916 2,858 2,867 2,853

Worldwide 5,658 5,310 5,469 5,211

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(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Earnings (loss) (U.S.

United States 486 625 810 1,395

342 450 389 1,086

Total 828 1,076 1,199 2,481

1 unchanged sentence

United States 486 625 810 1,395

342 450 389 1,086

Total 828 1,076 1,199 2,481

1 unchanged sentence

Due to rounding, numbers presented may not add up precisely to the totals indicated.

Chemical Products First Quarter Earnings Factor Analysis

Chemical Products Second Quarter Earnings Factor Analysis

(millions of dollars)

Margins – Weaker industry margins decreased earnings by $150 million.

Volume/Mix – Lower sales decreased earnings by $280 million, reflecting softening market conditions.

Other – All other items decreased earnings by $180 million, driven by higher scheduled maintenance expense.

Volume/Mix – Lower sales decreased earnings by $100 million.

Chemical Products Year-to-Date Earnings Factor Analysis

(millions of dollars)

Margins – Weaker industry margins decreased earnings by $730 million.

Volume/Mix – Lower sales decreased earnings by $350 million, reflecting weaker market fundamentals.

Other – All other items decreased earnings by $200 million, primarily driven by higher project and planned maintenance expenses.

Chemical Products Operational Results

(thousands of metric tons) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Chemical Products sales (1)

United States 1,725 1,998 3,286 4,030

3,124 2,812 6,212 5,798

Worldwide 4,849 4,811 9,498 9,829

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(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Earnings (loss) (U.S.

United States 373 232 824 478

298 185 621 415

Total 671 417 1,445 893

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United States 373 232 824 478

298 185 621 415

Total 671 417 1,445 893

(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items.

Specialty Products First Quarter Earnings Factor Analysis

Specialty Products Second Quarter Earnings Factor Analysis

(millions of dollars)

Margins – Improved margins, primarily related to basestocks, increased earnings by $390 million.

Volume/Mix – Unfavorable volume mix effects decreased earnings by $10 million.

Other – All other items, including negative foreign exchange impacts, decreased earnings by $80 million.

Margins – Stronger finished lubes and basestock margins increased earnings by $320 million.

Volume/Mix – Lower basestock sales decreased earnings by $90 million.

Other – All other items increased earnings by $20 million.

Specialty Products Year-to-Date Earnings Factor Analysis

(millions of dollars)

Margins – Improved margins increased earnings by $690 million, primarily related to lower feed costs.

Volume/Mix – Lower volumes decreased earnings by $80 million.

Other – All other items decreased earnings by $60 million.

Specialty Products Operational Results

(thousands of metric tons) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Specialty Products sales (1)

United States 514 590 991 1,111

1,391 1,511 2,855 2,995

Worldwide 1,905 2,100 3,845 4,107

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(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Earnings (loss) (U.S.

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Earnings (loss) excluding Identified Items (2) (Non-GAAP)

(506) (286) (861) (882)

(2) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items.

Corporate and Financing expenses were $355 million for the first quarter of 2023, $339 million lower than the first quarter of 2022, reflecting lower financing costs and the absence of an identified item associated with the expropriation of the Corporation's interest in Sakhalin-1.

Corporate and Financing expenses were $506 million for the second quarter of 2023, $220 million higher than the second quarter of 2022, reflecting unfavorable tax items and foreign exchange impacts, partly offset by lower financing costs.

Corporate and Financing expenses were $861 million for the first six months of 2023, $119 million lower than 2022, primarily reflecting the absence of an identified item associated with the Sakhalin-1 expropriation.

LIQUIDITY AND CAPITAL RESOURCES

(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Net cash provided by/(used in)

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Because of the ongoing nature of our asset management and divestment program, we believe it is useful for investors to consider proceeds associated with asset sales together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities, including shareholder distributions.

Cash flow from operations and asset sales in the first quarter of 2023 was $17.2 billion, an increase of $2.1 billion from the comparable 2022 period primarily reflecting higher earnings.

Cash provided by operating activities totaled $16.3 billion for the first three months of 2023, $1.6 billion higher than 2022.

Net income including noncontrolling interests was $11.8 billion, an increase of $6.1 billion from the prior year period.

Cash flow from operations and asset sales in the second quarter of 2023 was $10.7 billion, a decrease of $10.2 billion from the comparable 2022 period primarily reflecting lower earnings.

Cash provided by operating activities totaled $25.7 billion for the first six months of 2023, $9.0 billion lower than 2022.

Net income including noncontrolling interests was $20.0 billion, a decrease of $4.3 billion from the prior year period.

The adjustment for the noncash provision of $8.5 billion for depreciation and depletion was down $4.8 billion from 2022.

Changes in operational working capital were a reduction of $0.3 billion, compared to a contribution of $1.1 billion in the prior year period.

Changes in operational working capital were a reduction of $3.9 billion, compared to a reduction of $1.7 billion in the prior year period.

All other items net increased cash flows by $1.1 billion in 2023 versus a reduction of $1.2 billion in 2022.

See the Condensed Consolidated Statement of Cash Flows for additional details.

Investing activities for the first three months of 2023 used net cash of $4.9 billion, an increase of $1.0 billion compared to the prior year.

Investing activities for the first six months of 2023 used net cash of $9.3 billion, an increase of $2.3 billion compared to the prior year.

Spending for additions to property, plant and equipment of $10.8 billion was $3.0 billion higher than 2022.

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Net investments and advances increased $0.2 billion to $0.7 billion.

Net cash used in financing activities was $8.5 billion in the first three months of 2023, including $4.3 billion for the purchase of 39.3 million shares of ExxonMobil stock, as part of the previously announced buyback program.

Net cash used in financing activities was $16.7 billion in the first six months of 2023, including $8.7 billion for the purchase of 79.1 million shares of ExxonMobil stock, as part of the previously announced buyback program.

This compares to net cash used in financing activities of $15.4 billion in the prior year.

Total debt at the end of the first quarter of 2023 was $41.4 billion compared to $41.2 billion at year-end 2022.

The Corporation's debt to total capital ratio was 16.7 percent at the end of the first quarter of 2023 compared to 16.9 percent at year-end 2022.

The net debt to capital ratio was 4.1 percent at the end of the first quarter, a decrease of 1.3 percentage points from year-end 2022.

The Corporation's capital allocation priorities are investing in competitively advantaged, high-return projects, maintaining a strong balance sheet, and sharing our success with our shareholders through more consistent share repurchases and a growing dividend.

The Corporation distributed a total of $3.7 billion to shareholders in the first three months of 2023 through dividends.

Total debt at the end of the second quarter of 2023 was $41.5 billion compared to $41.2 billion at year-end 2022.

The Corporation's debt to total capital ratio was 16.7 percent at the end of the second quarter of 2023 compared to 16.9 percent at year-end 2022.

The net debt to capital ratio was 5.5 percent at the end of the second quarter, an increase of 0.1 percentage points from year-end 2022.

The Corporation's capital allocation priorities are investing in competitively advantaged, high-return projects;

maintaining a strong balance sheet;

and sharing our success with our shareholders through more consistent share repurchases and a growing dividend.

The Corporation distributed a total of $7.4 billion to shareholders in the first six months of 2023 through dividends.

The Corporation has access to significant capacity of long-term and short-term liquidity.

Internally generated funds are expected to cover the majority of financial requirements, supplemented by long-term and short-term debt.

The Corporation had undrawn short-term committed lines of credit of $0.4 billion and undrawn long-term committed lines of credit of $1.3 billion as of first quarter 2023.

The Corporation had undrawn short-term committed lines of credit of $0.5 billion and undrawn long-term committed lines of credit of $0.9 billion as of second quarter 2023.

The Corporation, as part of its ongoing asset management program, continues to evaluate its mix of assets for potential upgrade.

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Additionally, the Corporation continues to evaluate opportunities to enhance its business portfolio through acquisitions of assets or companies, and enters into such transactions from time to time.

Key criteria for evaluating acquisitions include strategic fit, potential for future growth and attractive current valuations.

Key criteria for evaluating acquisitions include strategic fit, cost synergies, potential for future growth, and attractive current valuations.

Acquisitions may be made with cash, shares of the Corporation’s common stock, or both.

Litigation, other contingencies, and contractual obligations are discussed in Note 3 to the unaudited condensed consolidated financial statements.

Litigation and other contingencies are discussed in Note 3 to the unaudited condensed consolidated financial statements.

Contractual Obligations

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.

Through July 2023, the Corporation has entered into various long-term agreements with an estimated total obligation of approximately $6.9 billion.

As of June 30, undiscounted commitments for leases not yet commenced totaled $4.1 billion for operating leases and $2.2 billion for finance leases.

(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Income taxes 3,503 6,359 8,463 9,165

1 unchanged sentence

Total other taxes and duties (1)

8,328 7,779 16,423 16,228

Total 11,831 14,138 24,886 25,393

(1) Includes “Other taxes and duties” plus taxes that are included in “Production and manufacturing expenses” and “Selli ng, general and administrative expenses”.

Total taxes were $13.1 billion for the first quarter of 2023, an increase of $1.8 billion from 2022.

Income tax expense was $5.0 billion compared to $2.8 billion in the prior year reflecting higher commodity prices.

The effective income tax rate of 34 percent declined from the 40 percent rate in the prior year period due primarily to a change in mix of results in jurisdictions with varying tax rates and one-time impacts in the prior period.

Total other taxes and duties decreased by $0.4 billion to $8.1 billion.

Total taxes were $11.8 billion for the second quarter of 2023, a decrease of $2.3 billion from 2022.

Income tax expense was $3.5 billion compared to $6.4 billion in the prior year reflecting lower commodity prices.

The effective income tax rate of 33 percent increased from the 31 percent rate in the prior year period due primarily to a change in mix of results in jurisdictions with varying tax rates.

Total other taxes and duties increased by $0.5 billion to $8.3 billion.

Total taxes were $24.9 billion for the first six months of 2023, a decrease of $0.5 billion from 2022.

Income tax expense decreased by $0.7 billion to $8.5 billion reflecting lower commodity prices.

The effective income tax rate of 34 percent was flat compared to the prior year period.

Total other taxes and duties increased by $0.2 billion to $16.4 billion.

CAPITAL AND EXPLORATION EXPENDITURES

(millions of dollars) Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Upstream (including exploration expenses) 4,609 3,627 9,190 7,506

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Specialty Products 103 56 194 79

Other 64 1 256 1

Total 6,166 4,609 12,546 9,513

Capital and exploration expenditures in the first quarter of 2023 were $6.4 billion, up $1.5 billion from the first quarter of 2022.

Capital and exploration expenditures in the second quarter of 2023 were $6.2 billion, up 34% from the second quarter of 2022.

Capital and exploration expenditures in the first six months of 2023 were $12.5 billion, up 32% from the first six months of 2022.

The Corporation plans to invest in the range of $23 billion to $25 billion in 2023.

Actual spending could vary depending on the progress of individual projects and property acquisitions.

IMPORTANT INFORMATION ABOUT THE TRANSACTION AND WHERE TO FIND IT

In connection with the proposed transaction between Exxon Mobil Corporation (“ExxonMobil”) and Denbury Inc.

(“Denbury”), ExxonMobil and Denbury will file relevant materials with the Securities and Exchange Commission (the “SEC”), including a registration statement on Form S-4 filed by ExxonMobil that will include a proxy statement of Denbury that also constitutes a prospectus of ExxonMobil.

A definitive proxy statement/prospectus will be mailed to stockholders of Denbury.

This communication is not a substitute for the registration statement, proxy statement or prospectus or any other document that ExxonMobil or Denbury (as applicable) may file with the SEC in connection with the proposed transaction.

BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS OF EXXONMOBIL AND DENBURY ARE URGED TO READ THE REGISTRATION STATEMENT, THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND RELATED MATTERS.

Investors and security holders may obtain free copies of the registration statement and the proxy statement/prospectus (when they become available), as well as other filings containing important information about ExxonMobil or Denbury, without charge at the SEC’s Internet website (http://www.sec.gov).

Copies of the documents filed with the SEC by ExxonMobil will be available free of charge on ExxonMobil’s internet website at www.exxonmobil.com under the tab “investors” and then under the tab “SEC Filings” or by contacting ExxonMobil’s Investor Relations Department at investor.relations@exxonmobil.com.

Copies of the documents filed with the SEC by Denbury will be available free of charge on Denbury’s internet website at https://investors.denbury.com/investors/financial-information/sec-filings/ or by directing a request to Denbury Inc., ATTN:

Investor Relations, 5851 Legacy Circle, Suite 1200, Plano, TX 75024, Tel.

(972) 673-2000.

The information included on, or accessible through, ExxonMobil’s or Denbury’s website is not incorporated by reference into this communication.

Participants in the Solicitation

ExxonMobil, Denbury, their respective directors and certain of their respective executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction.

Information about the directors and executive officers of Denbury is set forth in its proxy statement for its 2023 annual meeting of stockholders, which was filed with the SEC on April 18, 2023, and in its Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 23, 2023.

Information about the directors and executive officers of ExxonMobil is set forth in its proxy statement for its 2023 annual meeting of stockholders, which was filed with the SEC on April 13, 2023, and in its Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 22, 2023.

Additional information regarding the participants in the proxy solicitations and a description of their direct or indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials filed with the SEC when they become available.

No Offer or Solicitation

This communication is for informational purposes and is not intended to, and shall not, constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any offer, solicitation or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S.

Securities Act of 1933, as amended.

FORWARD-LOOKING STATEMENTS

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statements of future ambitions and plans;

and other statements of future events or conditions in this report, are forward-looking statements.

and other statements of future events or conditions in this release, are forward-looking statements.

Similarly, discussion of future carbon capture, transportation and storage, as well as biofuel, hydrogen, and other plans to reduce emissions are dependent on future market factors, such as continued technological progress, policy support and timely rule-making and permitting, and represent forward-looking statements.

3 unchanged sentences

plans to reduce future emissions and emissions intensity;

ambitions to reach Scope 1 and Scope 2 net zero from operated assets by 2050, plans to reach net zero Scope 1 and 2 emissions in Upstream Permian Basin unconventional operated assets by 2030, eliminating routine flaring in-line with World Bank Zero Routine Flaring, reaching near-zero methane emissions from its operations, meeting ExxonMobil’s emission reduction goals and plans, divestment and start-up plans, and associated project plans as well as technology efforts, timing and outcome of projects related to the capture, transportation and storage of CO2, and produced biofuels;

changes in law, taxes, or regulation including environmental regulations, trade sanctions, and timely granting of governmental permits and certifications;

6 unchanged sentences

government policies supporting lower carbon investment opportunities such as the U.S.

Inflation Reduction Act or policies limiting the attractiveness of future investment such as the additional European tax on the energy sector;

Inflation Reduction Act or policies limiting the attractiveness of future investment such as the additional European taxes on the energy sector;

variable impacts of trading activities on our margins and results each quarter;

7 unchanged sentences

final management approval of future projects and any changes in the scope, terms, or costs of such projects as approved;

changes in law, taxes, or regulation including environmental regulations, trade sanctions, and timely granting of governmental permits and certifications;

government policies and support and market demand for low carbon technologies;

1 unchanged sentence

expropriations, seizure, or capacity, insurance or shipping limitations by foreign governments or laws;

opportunities for potential investments or divestments and satisfaction of applicable conditions to closing, including regulatory approvals;

opportunities for potential acquisitions, investments or divestments and satisfaction of applicable conditions to closing, including timely regulatory approvals;

the capture of efficiencies within and between business lines and the ability to maintain near-term cost reductions as ongoing efficiencies;

8 unchanged sentences

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information about market risks for the three months ended March 31, 2023, does not differ materially from that discussed under Item 7A of the registrant's Annual Report on Form 10-K for 2022.

Information about market risks for the six months ended June 30, 2023, does not differ materially from that discussed under Item 7A of the registrant's Annual Report on Form 10-K for 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis