ExxonMobil Holdings Corporation Barclays 40th Annual Energy-Power Conference

You might be surprised, but this is very similar to how we develop our company plan, just through polling.

Excellent. Thank you, Betty, and it's great to be back at the Barclays CEO Energy-Power Conference. Last time I was here was in 2019 when I was the vice president of investor relations, so it's great to be back. Before we get to the Q&A, I just had a couple of slides that I wanted to share with the audience around a few things that we think at ExxonMobil we do really well and that are fundamental to how we create long-term shareholder value. This is our cautionary statement, brief cautionary statement. I won't go through it, but I will be making some forward statements, and we have more information on our investor relations website. These are three foundational pillars at ExxonMobil that underpin a lot of what we do and underpin our ability to create long-term shareholder value.

We also think these are three things that transcend markets. They transcend commodity price cycles. They will enable transition to different energy systems. They allow us to identify new products. They differentiate us from competition. Importantly, they help us to create long-term shareholder value. You look at each of these three. Technology, again, we think this is fundamental to the ability to continue to improve, to continue to identify products that society demands. I'm sure we'll talk about it today, but one of the things we've referenced often is the focus on technology in the Permian. We've got 40 complementary technologies that we're progressing with the focus on improving recovery and capital efficiency. Project execution. This is a capital-intensive business, and the ability to execute projects well is core. It's a core capability, and it is one we think that differentiates ExxonMobil.

We are, on average, executing double the number of major projects relative to competition, and we're doing it at 20% lower cost and 20% faster than everybody else. Then, of course, operations. The ability to maximize the assets that we have and to do that safely and reliably. We recently centralized a lot of these organizations across the enterprise to capture best practices and, more importantly, really to redefine what we consider to be industry-defining performance. Operations is a good example. When we look at turnarounds compared to the last cycle that we went through turnarounds at our sites, we're at 30% lower cost, and we're doing those turnarounds at 50% shorter duration than we did previously. Again, those three pillars underpin what we're trying to do, which is to grow long-term shareholder value. That starts with investing in advantaged, low-cost, high-return opportunities.

We feel we're advantaged in that area in terms of the portfolio that we have, and we're capitalizing on that. Then, of course, once you invest in those projects or as you invest in those projects, the importance of having financial strength. We talk about our strong balance sheet, AA- rated. Our net debt to capital, I think, is 11%. This last quarter, we reduced that by another $7 billion. That balance sheet allows us to continue to invest through cycles, through different markets. When others have to pull back or they have to cut distributions, we're able to lean in as opportunities arise. Then, of course, we want to share our success with our shareholders. When you look at the dividend, the dividend for us needs to be sustainable, growing and competitive, and all three of those elements are important.

We've been able to grow the dividend for 43 consecutive years now, and that is, I think, 95% better than most of the S&P 500. Share repurchases we view as flexible, tax-efficient ways to return cash to our shareholders. I just wanted to end with that. Again, I think we're well-positioned, given the capabilities that we have in technology, in project execution and operations. As a company, we want to be defined by what we do well, not necessarily by the products that we produce. With that, I'll turn it over to you, Betty, and Q&A.

Yeah, I think a couple of high-level things that we've seen, given what's happening in the Middle East. One is it's a stark reminder of the importance of providing affordable and reliable energy and products to the world. You can see how central that is to economic progress, how central that is to living standards, our day-to-day lives. I think this has been a stark reminder of that. The other thing we'd tell you is the market fundamentals, for the most part, are working. When you see a supply shock like we've seen in the oil markets, one of the things you're going to witness is a rush to try to increase supply. We've seen unprecedented levels of release of inventory, both strategic commercial reserves, but also strategic petroleum reserves. You've seen the supply side.

You've seen countries like the U.S. and Brazil increase their supply. At the same time, to help offset that, you've seen price play the role of demand destruction. You've seen demand destruction in chemical and refining. For the most part, the oil markets have settled into a fairly range-bound price scenario. We were a little surprised, I think, by the amount of inventory that was available to be released. On the refining side, we would tell you that's where the pinch point is today. That is somewhat driven by what's happening in the Middle East, products not coming out, but also the crude that's needed in Asia to run the refineries there. It's also what's happening between Ukraine and Russia. We're also seeing the Chinese are not exporting products, so you're seeing significantly higher margins in refining.

When we look at the entire energy system today, we would tell you that the supply shock and the pinch point really is around refining. What lessons have we learned? I think again back to the fact that what we do is really important to society. Then I think you are also seeing the market behave relative to long-term fundamentals in terms of supply and demand and how they respond to these types of situations.