Exxon Mobil Corporation

Good morning, everyone. Welcome to ExxonMobil's third quarter 2025 earnings call. Today's call is being recorded. We appreciate you joining us. I'm Jim Chapman, Vice President, Treasurer and Investor Relations. And I'm joined by Darren Woods, Chairman and Chief Executive Officer, and Kathy Michaels, Senior Vice President and Chief Financial Officer. This quarter's presentation and pre-recorded remarks are available on the Investors section of our website. They are meant to accompany the third quarter earnings press release, which is posted in the same location. During today's presentation, we'll make forward-looking remarks, including comments on our long-term plans, which are subject to risks and uncertainties. Please read our cautionary statement on slide two. You can find more information on the risks and uncertainties that apply to any forward-looking statements in our SEC filings on our website. We also provide supplemental information at the end of our earnings slides, which are also posted on our website. And now I'll turn it over to Darren for opening remarks.

Good morning, and thanks for joining us. Last December, we reviewed our corporate plan under the theme of a league of our own. The results we've delivered since then continues to support that theme. From the technologies we're deploying, to the major projects we're delivering, to the structural cost savings we're capturing, and the value we're creating, our results are truly in a league of their own. In fact, in the third quarter, we delivered our highest earnings per share compared to other quarters in a similar price environment. Let's start in Guyana, where we're breaking records with production of more than 700,000 barrels per day in the quarter. We brought Yellowtail online four months ahead of schedule. It's our fourth and largest development with production capacity of 250,000 barrels per day. Yellowtail was delivered in nearly the same time as previous FPSOs, despite a 70% increase in facility weight from its higher production capacity and improvements in GHG performance. We also sanctioned our seventh development, Hammerhead, which is expected to begin production in 2029. And importantly, we're making a positive and growing local impact. Guyanese now make up over two-thirds of the country's oil and gas workforce. more than 6,000 people, with more than 2,000 local businesses engaged. In the Permian Basin, another advantaged asset, we set yet another production record of nearly 1.7 million oil-equivalent barrels per day. We also acquired more than 80,000 net high-quality acres in the Midland Basin from Sinekin Petroleum. The transaction provides control of drilling locations and opportunities to further deploy our technology to drive greater returns. It's another example of bringing our portfolio advantages to an acquisition, ensuring that one plus one equals three or more. In addition, during the quarter, multiple third parties published reports validating the benefits of our lightweight propent. Last December, we shared how we're using low-cost refinery coke as a propent that penetrates deeper into fracks. This improves access and flow, which increases well recoveries by up to 20%. Wood McKenzie reported that our proprietary propent is delivering significant improvements in resource recovery, supporting our own results. They acknowledge that our upstream integration with refining operations create a strategic advantage that's difficult for others to replicate. And that lightweight propent is just one of many innovations we're developing to maximize upstream recoveries and grow the value of our unconventional business. This year, we expect about a quarter of our wells will use our new patented propent, and roughly 50% of new wells by the end of 2026. This, along with our cube development, pipeline of new technologies, and deep inventory of quality acreage, is why our Permian production continues to grow well into the next decade. This is an important point as it clearly differentiates us from our competitors. We're talking about reduced investments, peak production, or a shift to harvest mode. In our corporate plan update in December, we'll share more on our Permian success and how it's strengthening the value proposition of our broader portfolio. New to the world technologies are also playing a critical role, albeit on a slightly longer timeframe in our product solutions business. We're making solid progress with new products based on our Proxima systems. This year, we're tripling production capacity. At the same time, we're continuing to demonstrate significant value in use. With our Proxima-based rebar, we've demonstrated a 40% improvement in installation efficiency compared to steel. We've also introduced a new one-coat solution for marine cargo tanks that replaces the standard three-coat process. This cuts coating time in half, speeds up return to service, and delivers significant cost savings. These performance gains are helping us penetrate large established markets and key segments, where we're building the foundation of a strong pipeline of opportunities. We've had significant interest in our Proxima battery enclosures from Tier 1 auto OEM suppliers, based on the fast production speed and light weighting provided by our product. In 2026, we have the opportunity to demonstrate the superior subsea insulation and installation characteristics of our Proxima products in the oil and gas sector on our own Hammerhead FPSO. And then, our rebar infrastructure opportunities are expected to yield approximately 20,000 tons of cells by 2027. Through our signed MOUs with Mazdar and Goel Steel, investments in Proxima-based rebar manufacturing facilities will grow over the next two years. This will allow us to scale quickly into these fast-growing markets. In Singapore, we successfully started up our Rezid upgrade project and are converting low-value fuel oil into high-value lubricant products in diesel, using a proprietary catalyst at scale. Project utilization is currently around 80%, ramping to full capacity by year end, with our new-to-the-world base stock on-grade and delivered to customers. We've also progressed the development of our revolutionary battery anode graphite that can deliver breakthrough improvements in battery performance. Early feedback from leading auto OEMs and battery producers has been promising. Their testing shows the batteries can be charged 30% faster, provide a 30% increase in effective range, and last up to four times longer. This quarter, we also announced the acquisition of key assets from Superior Graphite, a leader in the graphite and specialty carbon market. Working with their team and incorporating their proprietary technology, we will develop and scale a differentiated graphitization process that is higher throughput, 50% more energy efficient, and significantly lower cost than available industry alternatives today. We also commissioned our newest supercomputer, Discovery 6, developed with Hewlett Packard Enterprise and NVIDIA, delivering a step change in exploration and seismic processing. This is the world's 17th most powerful computer. Seismic processing that used to take months now takes just weeks is already having an impact in Guyana, enabling more than a billion dollars in potential value capture from increased resource recovery at our first six FPSOs in the Staybrook block. Our longstanding focus on an investment in technical innovation is paying dividends. When coupled with the capabilities we've developed in execution excellence, we deliver results that others can't match. You've seen it this year with our global projects organization and the eight key startups we've highlighted to date, which includes some of the industry's largest and most complex projects. Our Proxima Systems expansion and Golden Pass LNG project both remain on track for startup around year end, completing the last two of our 10 key 2025 startups. Together, these 10 projects establish an important foundation to our 2030 earnings and cashflow growth plans. They're expected to drive more than $3 billion in earnings contributions next year at constant prices and margin. Before closing, I want to briefly touch on a new tool we introduced in the quarter to make it easier for our retail shareholders to support their company and vote their shares. In September, we introduced a first-of-its-kind free opt-in voting program for our millions of retail shareholders. Typically, only about a quarter of them, who own almost 40% of the company, vote at our annual meetings. We think shareholder participation should be the norm, not the exception. Our program, approved by the U.S. Securities and Exchange Commission, allows participants who choose to opt in to have their shares automatically voted to support management's recommendations. The program is completely optional, and participants can easily change their votes or opt out at any time. Since implementing it, we've been very encouraged by the positive feedback we've received, especially from other companies looking to replicate the program and make it easier for the voices of their retail shareholders to be heard. This is just one more example of the work we are doing to grow shareholder benefits and value. Stepping back, looking at the quarter and reflecting on the year-to-date results, we feel good about the progress we're making. We're delivering on all the challenging commitments we made, consistent with our track record since the pandemic, and setting the pace for industry. We're deploying innovative technologies that are delivering new-to-the-world approaches, processes, and products that drive industry-unique value. We're transforming how and where we work to improve our effectiveness and deliver structural cost reductions that exceed all of our competition. We're defining the industry benchmark and project execution for schedule and cost. on an unmatched number of projects. And most importantly, we're strengthening our competitive advantages and frankly, all aspects of our business to deliver earnings and cashflow growth now and far into the future. Looking forward, I'm confident we will remain in a league of our own. With that, we're happy to answer your questions.

Thank you, Darren. Before we move to Q&A, I have a quick announcement to share. Please mark your calendar for our annual corporate plan update, a virtual event this year, for Tuesday, December 9th at 9 a.m. Central Time. With that, we'll move to Q&A. Please note that we ask each analyst to limit themselves to one question as a courtesy to others. And operator, please open the line for our first question.