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Analyst Meeting 2018 – ExxonMobil

ExxonMobil · Mar 7, 2018 · 80 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Analyst Meeting 2018 – ExxonMobil – slide 1
    2018 Analyst Meeting March 7, 2018
  2. Analyst Meeting 2018 – ExxonMobil – slide 2
    Agenda 8:00 Welcome Jeff Woodbury Introduction Darren Woods Upstream spotlights Neil Chapman Open discussion Management Committee Break Downstream and Chemical spotlights Jack Williams Investment and financial plan, closing Darren…
  3. Analyst Meeting 2018 – ExxonMobil – slide 3
    Fundamentals drive long-term shareholder value Innovative technologies provide competitive advantage Integrated businesses capture opportunities across value chain Disciplined investments deliver industry-leading portfolio…
  4. Analyst Meeting 2018 – ExxonMobil – slide 4
    Businesses robust to the long term Brent crude price, 2017 dollars per barrel 135 90 45 0 1985 1990 1995 2000 2005 2010 2015 Source: Bloomberg, U.S. Bureau of Labor Statistics 2018 Analyst Meeting 5
  5. Analyst Meeting 2018 – ExxonMobil – slide 5
    Disciplined investment underpins shareholder value Average annual ROCE Cumulative impairments 2008 - 2017 after tax % 2008 - 2017 20 30 USD Billion 0 XOM XOM 0 XOM Peer group: BP, CVX, RDS, TOT -20 derived from public…
  6. Analyst Meeting 2018 – ExxonMobil – slide 6
    Meeting demand with advantaged investments Liquid supply / demand1 LNG growth MOEBD MTA 120 600 Demand Demand New supply New supply required required Decline without Existing & under investment construction 0 0 2015…
  7. Analyst Meeting 2018 – ExxonMobil – slide 7
    Investing in higher-value products Industry product demand shift Growth from 2016 to 2025 % 50 Source: ExxonMobil 2018 Outlook for Energy: A View to 2040, -30 IHS Fuel oil Gasoline Diesel Jet / Kero Chemicals 2018…
  8. Analyst Meeting 2018 – ExxonMobil – slide 8
    Progressing advantaged opportunities Capex Billion USD Upstream investments average 35 20% return1 Downstream investments average 20% return Chemical Chemical investments average Downstream 15% return Upstream 1At…
  9. Analyst Meeting 2018 – ExxonMobil – slide 9
    Driving value growth Potential increase in earnings by 2025 Excludes one-time impact of U.S. tax reform and impairments in 2017 See supplemental information 2018 Analyst Meeting 10
  10. Analyst Meeting 2018 – ExxonMobil – slide 10
    Cash flow grows with value Potential increase in cash flow by 2025 Cash flow from operations See supplemental information 2018 Analyst Meeting 11
  11. Analyst Meeting 2018 – ExxonMobil – slide 11
    Strengthening Upstream portfolio 3x 2017 earnings 10 BOEB high-value resources added in 2017 Fivefold increase in Permian tight-oil production 25 start-ups adding net 1 MOEB per day in 2025 Excludes one-time impact of U.S.…
  12. Analyst Meeting 2018 – ExxonMobil – slide 12
    Upgrading Downstream production 2x Proprietary technology improves project returns to 20% 20% margin improvement in shift to higher-value products 2017 earnings Capturing integrated Permian advantage in 2025 Excludes…
  13. Analyst Meeting 2018 – ExxonMobil – slide 13
    Leading in Chemical growth 2x 2017 earnings Growing capacity in North America and Asia by 40% Starting up 13 new world-class facilities Performance products delivering 50% earnings growth in 2025 Excludes one-time impact of…
  14. Analyst Meeting 2018 – ExxonMobil – slide 14
    Growing shareholder value Average annual ROCE 2015 - 2017 % 16 2025 2020 TOT RDS CVX BP 0 35 See supplemental information Average earnings 2015 - 2017 (Billion USD) 2018 Analyst Meeting 15
  15. Analyst Meeting 2018 – ExxonMobil – slide 15
    Strengthening Upstream portfolio 2018 Analyst Meeting 16
  16. Analyst Meeting 2018 – ExxonMobil – slide 16
    Improving Upstream financial performance Average annual ROCE 2015 - 2017 % 12 BP CVX TOT RDS 25 Average earnings 2015 - 2017 (Billion USD) See supplemental information 2018 Analyst Meeting 17
  17. Analyst Meeting 2018 – ExxonMobil – slide 17
    Improving Upstream financial performance Average annual ROCE 2015 - 2017 % 12 2025 2020 BP CVX TOT RDS 25 Average earnings 2015 - 2017 (Billion USD) See supplemental information 2018 Analyst Meeting 18
  18. Analyst Meeting 2018 – ExxonMobil – slide 18
    Industry-leading portfolio growth Exploration success Resource additions including acquisitions Total commercial discoveries 2012 - 2017 MOEB net MOEB net 2,000 10,000 1,000 5,000 0 Source: 0 Source: CVX BP TOT RDS XOM Wood…
  19. Analyst Meeting 2018 – ExxonMobil – slide 19
    Captured highest-quality acreage in 10+ years Key captures, 2017 Canada Drilling planned, 2018 - 2019 United States Cyprus Malaysia Mexico Mauritania Papua New Guinea Guyana Equatorial Guinea Brazil Mozambique South…
  20. Analyst Meeting 2018 – ExxonMobil – slide 20
    Next-generation assets drive growth Our strongest portfolio of opportunities since the merger Deep water Guyana, Brazil Attractive across range of prices All producing by 2025 Unconventional 50 % U.S. tight oil LNG PNG,…
  21. Analyst Meeting 2018 – ExxonMobil – slide 21
    Guyana: outstanding deepwater discovery 3.2 BOEB (gross) discovered Kaieteur Considerable upside potential 4 exploration wells in 2018 20 additional prospects Stabroek Ranger 10% return at 40/bbl Sorubim Payara Canje…
  22. Analyst Meeting 2018 – ExxonMobil – slide 22
    Guyana: rapid pace of development Production KBD gross 750 First production < 5 years after discovery 3 FPSOs by 2023 - 2024 developing 2 BOEB Payara + Potential gross 500 Further opportunities under development 250 Liza Ph…
  23. Analyst Meeting 2018 – ExxonMobil – slide 23
    Brazil: entry to significant growth potential Net acreage positions High-quality, 2 billion barrel Carcara field (gross) Million acres 2.0 10% return at 40/bbl Multi-billion barrel pre-salt prospects Under concession contracts 1.0…
  24. Analyst Meeting 2018 – ExxonMobil – slide 24
    Growing deepwater position at low cost Deepwater volumes Deepwater new developments KOEBD net KOEBD net 750 400 Potential upside Romania, West Africa 500 200 New developments 250 Guyana, Brazil Existing 0 0 2018 2021…
  25. Analyst Meeting 2018 – ExxonMobil – slide 25
  26. Analyst Meeting 2018 – ExxonMobil – slide 26
    U.S. tight oil: unique competitive position Total horizontal wells1 2017 production (KOEBD net)2 Operated, oil and gas Key unconventional liquids plays Leading unconventional portfolio and capability 6,469 203 3.2 million net acres in…
  27. Analyst Meeting 2018 – ExxonMobil – slide 27
    U.S. tight oil: unique competitive position Hydrocarbon density map for Permian tight oil Operated contiguous acreage Expanding contiguous position through Midland acquisitions and trades Basin Enables industry-leading,…
  28. Analyst Meeting 2018 – ExxonMobil – slide 28
    U.S. tight oil: unique competitive position PV of Permian lateral length % of PV vs. 5K ft well, estimated Leading capital efficiency 200 3-mile laterals meeting expectations Increasing Bakken recoveries 15 - 25% per well 100…
  29. Analyst Meeting 2018 – ExxonMobil – slide 29
    U.S. tight oil: unique competitive position USGC light crude refining capacity KBD Unique integrated position 800 2021 2025 Differentiated with world-class 2017 2017 manufacturing on U.S. Gulf Coast 0 Expanding refining and…
  30. Analyst Meeting 2018 – ExxonMobil – slide 30
  31. Analyst Meeting 2018 – ExxonMobil – slide 31
    Improving U.S. profitability XTO U.S. net production KOEBD Focused move to liquids production 900 Accelerating with Permian and Bakken growth Dry + associated gas Selectively investing in low-cost 600 dry gas plays Aggressive…
  32. Analyst Meeting 2018 – ExxonMobil – slide 32
    Attractive LNG opportunities for low cost of supply Global LNG growth Potential new capacity by 2025 MTA MTA net 600 16 Demand New supply ExxonMobil plan…
  33. Analyst Meeting 2018 – ExxonMobil – slide 33
    Papua New Guinea: development synergies PNG resource growth Aggressive exploration program TCF 12 4 - 5 further wells planned for 2018 - 2020 Captured high-quality resources through InterOil acquisition Significant recent…
  34. Analyst Meeting 2018 – ExxonMobil – slide 34
    Mozambique: world-class gas resource Mozambique growth potential Funded participation in Coral floating LNG MTA gross 3.4 MTA capacity, 2022 start-up 40 Progressing low-cost Area 4 development ExxonMobil leading onshore…
  35. Analyst Meeting 2018 – ExxonMobil – slide 35
    Aggressively driving Upstream competitiveness 97 BOEB total net resource 100 Maintaining exploration activity through cycle Evaluating Highgrading portfolio Design/develop Exploration success, high-value acquisitions Proved Large…
  36. Analyst Meeting 2018 – ExxonMobil – slide 36
    Essential progress on Kearl Production and cost KBD gross /bbl Growing cash generation capacity Achieved break-even1 < 50 WTI, 180 kbd gross 50 250 Leveraging integrated R&D, refining capability Focus on reliability, cost and…
  37. Analyst Meeting 2018 – ExxonMobil – slide 37
  38. Analyst Meeting 2018 – ExxonMobil – slide 38
    Upgrading Downstream production
  39. Analyst Meeting 2018 – ExxonMobil – slide 39
    Growing Downstream & Chemical value Average annual ROCE 2013 - 2017 % 25 CVX TOT RDS BP 0 20 See supplemental information Average earnings 2013 - 2017 (Billion USD) 2018 Analyst Meeting 40
  40. Analyst Meeting 2018 – ExxonMobil – slide 40
    Growing Downstream & Chemical value Average annual ROCE 2013 - 2017 % 25 2025 2020 CVX TOT RDS BP 0 20 See supplemental information Average earnings 2013 - 2017 (Billion USD) 2018 Analyst Meeting 41
  41. Analyst Meeting 2018 – ExxonMobil – slide 41
    Growing Downstream value Average annual ROCE 2013 - 2017 % 30 MPC VLO PSX RDS 0 10 See supplemental information Average earnings 2013 - 2017 (Billion USD) 2018 Analyst Meeting 42
  42. Analyst Meeting 2018 – ExxonMobil – slide 42
    Growing Downstream value Average annual ROCE 2013 - 2017 % 30 2025 2020 MPC VLO PSX RDS 0 10 See supplemental information Average earnings 2013 - 2017 (Billion USD) 2018 Analyst Meeting 43
  43. Analyst Meeting 2018 – ExxonMobil – slide 43
    Consistently highgrading portfolio Portfolio vs. 20081 Capital employed reduced by 8B through divestments % 100 13 refineries 13 terminals 4,653 miles of pipeline 7,844 retail sites 0 2008 Number of Number of Pipeline miles…
  44. Analyst Meeting 2018 – ExxonMobil – slide 44
    Continuing to drive efficiencies Downstream operating expenses Refinery unit cash operating expense1,2 Billion USD (constant forex, energy price) 2008 - 2017 average unit cost, indexed 30 100 0 70 3 4 2008 2011 2014 2017…
  45. Analyst Meeting 2018 – ExxonMobil – slide 45
    Product shifts improving profitability ExxonMobil Downstream product shift 2025 vs. 2017 % Upgrading 200 KBD of fuel oil to higher-value products 50 Growing Group II basestocks and distillate 20% Leveraging strong lubricants and…
  46. Analyst Meeting 2018 – ExxonMobil – slide 46
    Advantaged investments, high returns Investment returns % 20 9B investment in 6 major refinery projects Integration / Optimization Proprietary process / catalyst technology Proprietary Technology Integrated circuit with unmatched…
  47. Analyst Meeting 2018 – ExxonMobil – slide 47
    Doubling Rotterdam refinery earnings 2x margin Proprietary-technology-enabled project generates 20% return Improves Rotterdam and NW Europe circuit competitiveness Growing global Group II basestock production 35%; first in…
  48. Analyst Meeting 2018 – ExxonMobil – slide 48
    Extending lubricants leadership Product leadership1 Strategic lube basestocks investments underway Lube basestocks 1 Continued growth of strong synthetics position Finished lubricants 2 Synthetic lubricants 1 Volumes growing at 3x…
  49. Analyst Meeting 2018 – ExxonMobil – slide 49
    Value chain earnings growth Mexico, Indonesia 2x Permian Fuels integration Value chain Organizational efficiencies Commercial leverage Advantaged Lubricants 2017 earnings refining Value chain in 2025 investments Group…
  50. Analyst Meeting 2018 – ExxonMobil – slide 50
    Advantaged investments grow earnings Earnings Billion USD 10 Manufacturing cost advantage vs. industry Emerging market product sales grow 20% 9B refining investments generate 20% returns Leveraging unique integration advantage…
  51. Analyst Meeting 2018 – ExxonMobil – slide 51
    Leading Chemical growth 2018 Analyst Meeting 52
  52. Analyst Meeting 2018 – ExxonMobil – slide 52
    Growing unique Chemical competitive position Average annual ROCE 2013 - 2017 % 30 RDS SINOPEC1 SABIC DWDP 0 9 Average earnings 2013 - 2017 (Billion USD) 1 SINOPEC 2017 estimated from 3Q17 results See supplemental…
  53. Analyst Meeting 2018 – ExxonMobil – slide 53
    Growing unique Chemical competitive position Average annual ROCE 2013 - 2017 % 30 2020 2025 RDS SINOPEC1 SABIC DWDP 0 9 Average earnings 2013 - 2017 (Billion USD) 1 SINOPEC 2017 estimated from 3Q17 results See…
  54. Analyst Meeting 2018 – ExxonMobil – slide 54
    Strengthening of competitive position Average earnings & ROCE1 Product leadership position Billion USD ROCE % Polyethylene 1 Differentiated polyethylene 1 4 20 ROCE Fluids / plasticizer 1 Propylene-based plastomer1 1 Adhesions 1…
  55. Analyst Meeting 2018 – ExxonMobil – slide 55
    Leveraging our competitive advantages Advantaged USGC ethylene supply ExxonMobil USGC margin advantage Production cost /T 1,000 Western Integration Europe China Proprietary Middle technology US Gulf East Coast Margin…
  56. Analyst Meeting 2018 – ExxonMobil – slide 56
    Developing high-performance products Performance polyethylene technology development Performance products sales growth Relative performance Volume, indexed 250 ExceedTM XP ExxonMobil performance product sales ExceedTM Mechanical…
  57. Analyst Meeting 2018 – ExxonMobil – slide 57
    Global reach into growing markets 4 Innovative technology centers 2018 Analyst Meeting 20 World-class manufacturing sites 1 Container moved every minute via world-class supply chain 58
  58. Analyst Meeting 2018 – ExxonMobil – slide 58
  59. Analyst Meeting 2018 – ExxonMobil – slide 59
    Leveraging competitive strengths to grow Earnings Billion USD Doubling earnings through 8 Product leadership Proprietary technology Global market access Integration 4 2017 2018 2019 '20 - '24 Avg 2025 Asia cracker and…
  60. Analyst Meeting 2018 – ExxonMobil – slide 60
    Investment and financial plan
  61. Analyst Meeting 2018 – ExxonMobil – slide 61
  62. Analyst Meeting 2018 – ExxonMobil – slide 62
  63. Analyst Meeting 2018 – ExxonMobil – slide 63
    Productively generating cash flow Cash flow from operations over capex1 (cumulative 2008 2017) % 120 XOM 0 1Cumulative capex from publicly available data and adjusted for: RDS includes BG acquisition (2016 - 53B) XOM includes…
  64. Analyst Meeting 2018 – ExxonMobil – slide 64
    Progressing advantaged investments Capex Billion USD New investments 30 Downstream (avg return 20%) Rotterdam advanced hydrocracker Beaumont light crude expansion Acquisitions Singapore resid upgrade expansion Fawley hydrofiner…
  65. Analyst Meeting 2018 – ExxonMobil – slide 65
    Relentlessly focused on the fundamentals Workforce lost-time incident rate1 Operating costs Employee and contractor lost-time incidents per 200K hours Billion USD -11B 0.2 80 New business 0.1 Industry ExxonMobil…
  66. Analyst Meeting 2018 – ExxonMobil – slide 66
    Ability to pursue attractive opportunities Leverage, year-end 2017 Competitively advantaged balance sheet Total capitalization Billion USD Attractive terms for accessing capital 400 AA+/Aaa RDS Flexibility to capture opportunities…
  67. Analyst Meeting 2018 – ExxonMobil – slide 67
  68. Analyst Meeting 2018 – ExxonMobil – slide 68
    Committed to growing shareholder value Managing to long-term fundamentals Reliably growing cash dividend Capturing opportunities across price cycle Maintaining financial flexibility Returning excess cash to shareholders 2018…
  69. Analyst Meeting 2018 – ExxonMobil – slide 69
    Growing shareholder value Average annual ROCE 2015 - 2017 % 16 2025 2020 TOT RDS CVX BP 0 35 See supplemental information Average earnings 2015 - 2017 (Billion USD) 2018 Analyst Meeting 70
  70. Analyst Meeting 2018 – ExxonMobil – slide 70
    Discussion 2018 Analyst Meeting 71
  71. Analyst Meeting 2018 – ExxonMobil – slide 71
    Backup 2018 Analyst Meeting 72
  72. Analyst Meeting 2018 – ExxonMobil – slide 72
    Supplemental information The following table reconciles U.S. Upstream earnings excluding effects of U.S. tax reform in 2017 and impairments in 2016 and 2017 to U.S. GAAP earnings. (millions of dollars) 2016 2017 U.S. Upstream Earnings…
  73. Analyst Meeting 2018 – ExxonMobil – slide 73
    Supplemental information Resources, resource base, recoverable resources. These and similar terms include quantities of oil and gas that are not yet classified as proved reserves under SEC definitions but that are expected to be moved…
  74. Analyst Meeting 2018 – ExxonMobil – slide 74
    Supplemental information Other information All references to production rates and project capacity are on a gross basis, unless otherwise noted. References to resource size are on a net basis, unless otherwise noted. Competitor data is…
  75. Analyst Meeting 2018 – ExxonMobil – slide 75
    Reference material 2018 Analyst Meeting 79
  76. Analyst Meeting 2018 – ExxonMobil – slide 76
    Energy Outlook guides business strategy Long-term view of supply and demand informs Global energy demand investment plans Quadrillion BTUs Non-OECD nations drive growth in GDP and 750 0.9% 2040 Average Growth/Year energy demand 2016…
  77. Analyst Meeting 2018 – ExxonMobil – slide 77
    Energy Outlook guides business strategy All forms of energy are required to meet global energy demand Global energy demand Quadrillion BTUs Oil and natural gas lead growth as energy mix evolves 250 Average Growth/Year 0.7% 2016 to…
  78. Analyst Meeting 2018 – ExxonMobil – slide 78
    Committed to operational integrity Risk management maintains license to operate Safety Leadership Security and creates value across the business & people Ensuring personnel and process safety Policies, Monitoring standards & &…
  79. Analyst Meeting 2018 – ExxonMobil – slide 79
    2017 results Demonstrates strength of integrated business Workforce lost-time incident rate1 Employee and contractor lost-time incidents per 200K hours Leading safety performance 0.2 Earnings 19.7B ROCE 9.0% 0.1 Industry Cash…
  80. Analyst Meeting 2018 – ExxonMobil – slide 80
    Outperform peers over long term Return on average capital employed % 20 2008 - 2017 average 2013 - 2017 average Best investment opportunities since merger 2017 ROCE of 15% in 2025 at 60/bbl real 0 XOM CVX RDS TOT BP See…

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