Agenda Topic Speaker Time Brad Corson Opening remarks 8:00 Chairman, President and CEO Environmental/Social/Governance Theresa Redburn 8:20 SVP, Commercial and Corporate Development Simon Younger Upstream outlook 8:40 SVP,…
Opening remarks Brad Corson Chairman, President and Chief Executive Officer
A history of success Well positioned for the future Imperial 2020 4
Impressions to date Reflecting on the past year Strong leadership team focused on winning and driving shareholder value Impressive organizational talent and commitment High-quality assets with significant long-term potential…
What you will hear today Themes and focus areas Delivering superior value to shareholders Driving down unit costs; relentless focus on reliability Pursuing low-cost debottlenecks Enhancing downstream logistics, growing high-value…
Imperials COVID-19 response Protecting our workforce and communities; positioning for recovery Continued operations ensuring reliable energy supply Careful management of health and safety of workforce Adjusted turnaround timing,…
Managing through a challenging environment Built to weather the downcycle Focus on what we can control Take the long-term view Maintaining balance sheet strength Continued emphasis on operational flexibility Organizational…
Progress on capital and expense reductions Exceeding cost and capital control commitments to date Capital expenditures Production & manufacturing expenses B B 2 8 -1B, (-16%) -0.8B, (-45%) 1 4 0 0 2020 PL 2020 OL 2019 2020 OL…
Near-term view of the recovery Unprecedented demand reduction due to COVID-19; recovery underway Global oil supply/demand balance mbd US/bbl 105 80 Globally Energy demand decreased dramatically 70 Rapid recovery through summer,…
ESG Theresa Redburn Senior Vice President, Commercial and Corporate Development
Responsibly meeting global energy needs Imperial among the best in Canada and abroad Oil and gas remain significant sources of energy Canada is first in ESG among top global reserves holders Imperial is an ESG leader in the oil and…
Oil and gas will continue to supply energy needs Global investment opportunities to meet future demand Oil and gas remain a significant source of energy under a wide range of scenarios Between US 12 trillion and US 17 trillion…
Canada is an ESG leader The choice for responsible energy worldwide Environmental Performance Social Progress Index Worldwide Governance Index Indicators 80 100 100 40 50 50 Not ranked 0 0 0 Yale, Columbia universities…
Imperial is a top ESG performer Independently judged to be among the best global oil and gas companies Source: CSRHub , February 2020, BMO Capital Markets estimates Imperial 2020 15
Imperials strategy for a lower-carbon future Inspired to improve the quality of life for Canadians and those around the world Imperial 2020 16
Reducing operated oil sands GHG intensity Actions drive measurable near-term improvement Greater than 20% reduction in GHGi since 2013 Target to reduce operated oil sands GHGi by a further GHGi 10% by end of 2023, relative to 2016…
Imperials oil sands technology competes globally Next-generation in situ technologies are game changers Canada a leader in GHG emissions measurement and reporting Kearl oil sands mining is below the global and US upstream averages…
Technology is key to the future Enables production growth and emissions reductions Short Term Medium Term Long Term Next-generation upstream Renewables and GHGi Energy diversification technologies Ongoing Developing Evaluating…
Social innovation Creating long-term economic and social benefit Collaborating with Indigenous and community neighbours on: A common vision for progress Sustainable economic development Environmental stewardship Awarded Canadian…
Board oversees ESG risks and opportunities Diverse perspectives in pursuit of superior shareholder value ESG integration at all levels supported by Public policy and corporate responsibility committee Community collaboration and…
Imperials triple win A formula for collective success and delivering real value Reduce environmental footprint Leveraging industry-leading technologies to deliver GHGi reduction solutions Helping our customers reduce their…
Upstream Outlook Simon Younger Senior Vice President, Upstream
Upstream vision Best-in-class producer, maximizing cash flow Maximize value from long-life, low-decline assets Targeting industry-leading unit cost and reliability Select, disciplined capital investments High-impact innovation and…
2020 Upstream performance Demonstrating resilience through unprecedented external challenges Reduced spend B 6 Savings Lowest-ever workplace hurts 3 Safely assured business continuity Rapid response to weak demand and low 0…
Long-life, low-decline asset base Stable production base; focused on selective growth Production koebd 6.3 billion boe of proved and probable 400 reserves Over 25-year proved reserves life 300 415 koebd production in 2021 200…
Upstream cash flow outlook Delivering value and generating strong cash from operating activities Average annual cash from operating activities B 1.5 billion annual average in 201719 Scenarios 3 Thousands US 60/bbl WTI…
Upstream investment outlook Investing for value and select volume growth Average annual capital expenditures B 2 Investment profile below prior outlook 2020-21 proactive reductions; capex down 40% Growing production to 435 kboed by…
Large portfolio of investment options Selecting investments to deliver maximum value Opportunity type Representative projects NPV/I range Deep portfolio of projects US 40-60 WTI Optionality spans Upstream Schedule optimization…
Accelerating innovation and modernization Industry-leading digital technology and artificial intelligence Advanced analytics, digital workforce, increased value Digital investment principles Maximize asset recovery and production…
Digital in action Intense focus on cost optimization and short payback on investment Workforce visualization: 50M+/yr Autonomous haul systems: US 1/bbl cost savings Schedule optimization: 15M+/yr First autonomous 797F globally to…
Digital in action with cutting-edge applications Progressing the next tranche of opportunities Internal drone inspections Kearl plant digital twin Advanced data-driven analytics Connected worker/equipment Commodity input reduction…
Investing in technology to maximize value Ongoing commitment to research and development Advanced metallurgy Enhanced in-line flocculation Coarse tailings bitumen recovery Mining Enhanced Late-life Process, ELP Non-Condensable…
Kearl journey Stable, reliable operations enabling optimization phase Production Unit P&M expenses Reliability focus delivering improvements kbd US/bbl 300 40 Resolved significant reliability bad actors Extraction and froth treatment…
Autonomous haul update Fleet conversion improves profitability and safety First automated 797-model haul trucks in ore globally Most ultra-class autonomous trucks in oil sands 22 trucks converted, target of 25 by YE 2020…
Kearl in-pit tailings project Sustaining production at lowest cost Transition to in-pit tailings when external tailings reach capacity in 2023 Safest and lowest-cost solution, minimizing land disturbance 750 million capital…
Cold Lake strategy Maintain strong cash flow generation and reduce GHGi Production kbd 150 Resilient cash generation through cycles Positive cash generation in 2020 100 Strong action to reduce costs; paced capital spending Maintained…
Select Cold Lake capital investments Production of 140 kbd by 2024 Infill drilling Mahkeses LASER Grand Rapids Phase 1 Access adjacent reservoir Solvent injection into existing wells SA-SAGD leveraging existing Nabiye Flexible…
Syncrude strategy Reliability focused, supported by collaboration Production kbd Strong partner engagement and collaboration 90 COVID Capturing reliability investment benefits 2019 second-best year in assets history 60 15% combined…
Syncrude interconnect pipeline Maximizing value through owner collaboration Syncrude Suncor Base Mine Project commissioning Q4 2020 Mine & extraction Mine, extraction & SAGD Interconnect bitumen pipeline Asset integration drives…
Future resource optionality Material and diverse portfolio of organic growth opportunities Large inventory of opportunities Aspen rendering of central plant In situ development: Aspen, Corner, Clarke Creek, Clyden Unconventional…
Upstream summary Best-in-class producer; maximizing value Focus on maximizing value from existing assets and incremental efficient growth Kearl volumes and cost improvement outpacing prior outlook Realizing 150 million per year in…
Break
Downstream and Chemical Outlook Jon Wetmore Vice President, Downstream
Downstream strengths Leveraging assets, logistics and sales to drive cash generation Industry-leading refineries running advantaged crudes Profitable markets accessed by industry-leading logistics Product slate and sales portfolio…
Downstream cash generation Focus on efficiency, optimization and margin enhancement Average annual cash from operating activities Canadian demand (% of normal) B 2 80 - 90% 85 - 95% 40% October 2020 October 2020 October 2020 1 75…
Canadian downstream market environment Advantaged markets; Imperial well-positioned Market environment Imperial position Large geography, dispersed demands Access to cost-advantaged logistics Imports have limited reach Improved…
Canadian product margins Favourable and growing unit margins contribute to integration benefits Average monthly gasoline crack Average monthly diesel crack US/bbl US/bbl 80 80 Avg. Canadian gasoline crack Avg. Canadian diesel crack…
Canadian refining leadership Leader in North American refining; applying global best practices Performance Energy Non-energy Total Net cash quartile efficiency cash cost cost margin Cost leadership Top quartile Solomon performance…
Downstream value chain Imperials downstream participates in the full value chain to end consumers kbd 500 Purchases Trading Marine Synthetic Other Flex B2B Gasoline Commercial 250 Light Jet Retail Retail Flex Diesel Heavy…
Fuels, lubricants, and asphalt sales channels Leading brands, products, offers, dealers and customers Sales volumes % Branded Wholesaler relationships in Retail 100% Efficient growth with specialist retailer partners; capital…
Downstream investments Efficient, strategic investments in low-capital, high-return business Capital expenditures M 700 Selective investments in refinery slate, production, efficiency and resiliency Support and enhancement of…
Strathcona cogeneration Increases efficiency, reduces cost and emissions 200 million investment 41megawatt capacity 75 - 80% of site power Up to 50% of steam 112,000 tonnes annual GHG emissions reduction Nearly 24,000 cars…
Sarnia products pipeline Secures efficient, reliable and safe capacity 400 million investment In service early 2022 Secures key infrastructure for growing Toronto-area fuel supply Eliminates bottleneck in growing market with…
Edmonton rail terminal Efficient, strategic egress and optionality Provides strategic optionality and risk reduction Transport flexibility provides increased market access for upstream production Advantaged with low fixed costs and…
Downstreams total package Coast-to-coast reach, leveraging strategically advantaged assets and brands Imperial and third-party owned sites 2100 Retail service stations 40 Terminals 14 Airports 160 Truck Transport sites 80…
Imperials downstream advantage Well positioned for future market success Market evolution Imperial position Pipeline capacity additions Favourable light crude refining economics WCS/MSW spreads tighten to transport parity Enbridge…
Imperial Chemical produces high-value products High-density polyethylene used in variety of durable products Key end uses Other Spot Injection molding (pails, containers, crates) Rotational molding (storage tanks, toys) Marcellus…
Chemical site integration drives efficiency Long-term strength with increasing demands Average annual cash from Demand change from 2010 Feedstock operating activities % M % 100 Other 80% 300 Polyethylene Demand Marcellus Mid-west…
Downstream and Chemical summary Sustainably advantaged assets and offers; strategically positioned for the future 100% Canadian refining Leading market share in most segments Efficient pipeline access to Canadian crude Highly…
Financial Outlook Dan Lyons Chief Financial Officer
Financial profile Resilient with upside leverage 10-year average, % of cash from Integrated, balanced business model operating activities Growing production, long-life assets Advantaged refining, leading fuels marketer Integrated…
Advantaged access to capital Supported by industry-leading credit rating Sept. 30, 2020 debt to capital Debt-to-capital has remained at a low % level, absolute and relative to peers 50 No additional debt to date in 2020 Multiple…
Capital allocation priorities Focus on returning excess cash to shareholders Dividend per share Reliable and growing dividend Strong balance sheet 1.00 CAGR = 11% Sustaining capital 0.80 CAGR = 5% Select investment in…
Capital expenditure outlook Focus on sustaining capital and select growth Total annual capital expenditures 2021 target of 1.2 billion B 2 5-year average down 30% vs. prior year view Sustaining capital averages 1.1 billion 1…
Corporate WTI breakeven Resilience at low prices Estimated WTI breakevens Cash flow from operating activities breakeven US 27/bbl Cash flow from operating activities and sustaining capital breakeven US 33/bbl Cash flow from…
Significant leverage to higher prices Substantial cash available for return to shareholders Cash flow from operating activities B 5 US 60/bbl WTI 4 US 50/bbl WTI 3 US 40/bbl WTI Surplus cash 2 Sustaining capital +…
Summary of 2020 and 2021 guidance Annual guidance 2020 OL 2021 FC Total capex B 0.9 1.2 Upstream production kboed 395 415 Kearl kbd (gross) 220 255 Cold Lake kbd 135 130 Syncrude kbd 70 75 Refinery throughput kbd 340 375…
Closing remarks Brad Corson Chairman, President and Chief Executive Officer
The Imperial advantage Robust through the cycle Commitment to deliver winning shareholder value High-quality, long-life assets Integration supports resilience through market cycles Industry-leading balance sheet strength…
Our winning strategy Focus and deliver Focusing on the core Get the most out of existing assets Target industry-leading reliability, cost structure Capture value from integration Progress towards ESG targets Return more cash to…
For more information: Dave Hughes Vice President, Investor Relations +1 587.476.4743 dave.a.hughesexxonmobil.com imperialoil.ca twitter.com/ImperialOil linkedin.com/company/Imperial-Oil youtube.com/ImperialOil…
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