Taking on the world s toughest energy challenges. Global Refining : Delivering Long-Term Value J. Steve Simon Sr. Vice President, Exxon Mobil Corporation Goldman Sachs Global Energy Conference January 18, 26
Cautionary Statement Forward-Looking Statements. Outlooks, projections, estimates, targets, and business plans in this presentation are forward-looking statements. Actual future results, including demand growth and mix; vehicle fleet composition; refinery additions and capacity increases; project plans, timing, and costs; efficiency and cost improvements; and the impact of technology could differ materially due to a number of factors. These include changes in long-term oil or gas prices or other market conditions affecting the oil and gas industries, including changes in refining or marketing margins; severe weather events; war and other political or security disturbances; changes in law or government regulation; the outcome of commercial negotiations; the actions of competitors; unexpected technological developments; the occurrence and duration of economic recessions; and other factors discussed here and under the heading "Factors Affecting Future Results" in the Investor Information section of our website at www.exxonmobil.com. Frequently Used Terms. For definitions and additional information regarding return on capital employed, normalized earnings (also referred to as operating earnings), cash flow from operations and asset sales (also referred to as operating cash flow), and other terms used in this presentation, including information required by SEC Regulation G, see the Frequently Used Terms, quarterly reports on form 8-K regarding results of operations and financial condition, and other material posted on our website. The Financial and Operating Review on our website also shows ExxonMobil's net interest in specific projects.
Long-standing ExxonMobil Approach Disciplined Investment Superior Cash Flow Growth in Shareholder Value Operational Excellence Industry Leading Returns
World Energy Demand Continues to Grow MBDOE 35 Solar/Wind 3 Energy demand up 5% Bio/MSW Hydro 25 Fossil fuels remain predominant Nuclear 2 Coal 15 Gas 1 5 198 Oil demand grows @ 1.4%/yr Oil 199 2 21 22 23
Oil Demand Continues to Grow Oil Demand By Market Oil Demand By Sector MBD MBD 12 12 Heat/Other 8 Non-OECD 2.5%/yr 8 Other Chemicals Electricity 4 OECD.3%/yr 4 Transportation 2 21 22 23 2 21 22 23 Driven by emerging markets Led by transportation sector
Vehicle Fleet Changing Light Duty Fleet North America Europe Asia Pacific Million 5 Million 5 Million 5 4 4 4 3 3 Hybrid 3 2 2 Diesel 2 1 1 Gasoline 1 2 21 22 23 2 21 22 23 2 21 22 23
Fuel Efficiency Dampens Demand Light Duty Fuels Demand North America Europe Asia Pacific MBDOE 12 MBDOE 12 MBDOE 12 1 1 1 8 8 8 6 6 6 4 4 4 Diesel 2 2 2 2 21 22 23 Gasoline 2 21 22 23 2 21 22 23
Refining Capacity Growing Global Distillation MBD (cumulative) 12 Refining capacity up 1.5% 2.3% per year 9 6 High Case NA Growth via new builds and debottlenecks 3 ROW 25 26 27 28 29 21
Refining Balances U.S. Perspective U.S. Gasoline and Distillate Balances MBD 2 15 Domestic Refinery Output Imports Historic Growth @ 1.4%/yr Distillate Demand 1 5 Gasoline Demand 199 1995 2 25 21 215 22 Source: EIA, EM Estimates
Clean ProductsP roductio n Capacity Demand CP Ca pa c ity Dema nd CP Capacity CP Ca pa c ity De ma nd Dema nd CP Ca pa c ity CP Capac ity Dema nd Demand Refining Balances Global Perspective MBD MBD 2 MBD 2 MBD 2 1 1 Western Europe 1 Eastern Europe/FSU North America 2 2 1 2 1 South America Africa/Middle East 1 Asia Pacific Light Products Capacity Light Products Demand Source: IEA / EM Estimates
Industry Margins Long-term Perspective Refining Gross Margins Self-Help Margin Levers 25 $/bbl 1 8 Global Composite Current Net Margin Operating Costs Higher Value Products Lower Costs Raw Material Flexibility 6 4 Raw Materials Costs 2 1985 199 1995 2 25 Downstream Revenue, $
Global Scale and Integration Europe/AME 18 Refineries Americas 16 Refineries Asia-Pacific 11 Refineries Largest Global Refiner Largest Lubes Basestock Supplier Largest Global Producer of Polyolefins, Benzene & Paraxylene
Structural Advantages Average Refinery Size kbd Integration with Chemicals or Lubes % Capacity and Geographic Mix MBD 25 8 6 AP 2 7 4 EAME 15 6 2 Americas 1 XOM BP RDS Industry 5 XOM RDS BP Industry XOM RDS BP Industry-leading size and integration Strong position in mature markets Well-positioned for AP growth Source: O&GJ and ATEC
Raw Material Flexibility Crude Runs - Global Indexed 14 Crude Sulfur - US Indexed 12 Crude API Gravity - US Indexed 11 13 12 XOM Challenged Crudes 11 1 XOM 15 Industry 11 9 Industry 1 XOM 1 8 9 2 22 24 7 2 22 24 95 2 22 24 Increasing challenged and heavier crude runs Capturing Light / Heavy and Sweet / Sour differentials Lowering raw material costs via fingerprinting technology Source: EM, Solomon
Economic Capacity Growth Global Distillation Capacity MBD 7.3 7.2 7.1 XOM ~5 kbd per year 7. 2 22 24 Global Conversion Capacity MBD 2.6 2.5 XOM ~35 kbd per year 2.4 2 22 24 Equivalent to a new refinery every 3 years Source: EM / OG&J, 1% basis
Asset Utilization Unit Reliability Indexed 11 XOM Capacity Utilization Indexed 12 1 9 8 Throughput 1 98 XOM 7 Unplanned Capacity Loss 96 Industry 6 2 22 24 94 2 22 24 Unit reliability lowers cost / increases throughput Increasing utilization with technology Global Reliability and Maintenance Management System Equipment Health Monitoring Source: EM, Solomon
Operating Cost Efficiency Energy Index 14 12 1 98 96 94 Industry XOM 2 22 24 Unit Cash Costs Index 115 Industry 11 Workforce 15 XOM Index 13 12 11 1 Industry XOM 1 95 2 22 24 9 2 22 24 Source: Solomon
Higher Value Products Conversion Capacity Integration L&C Clean Product Yields MBD % Index 3 8 12 XOM 2 7 1 Industry 1 6 98 XOM RDS BP 5 XOM RDS BP Industry 96 2 22 24 More conversion capacity Superior integration with Lubes and Chemicals Increasing yield of higher value products with technology Molecule Management Process modeling and optimization Source: OG&J, Solomon
Advanced Technology Underpins Results Focus Areas Strategic Objectives R&D Programs Raw Material Flexibility Lower Crude Costs Capacity Utilization Molecular Optimization Crude Contaminant Control Fiber Optics Corrosion Sensors Coke Morphology Slurry Decoking Throttling Valve Lower Costs Improve Efficiency Higher Reliability Capacity Utilization Erosion Resistant Materials Low Energy Membrane Separations Advanced Catalysis Fouling Inhibition Technology Equipment Health Monitoring Higher Value Products Higher Yields Upgrade Products Increase Margin Rapid Cycle Pressure Swing Adsorption Process Modeling & Optimization Tools Plant Automation Molecule Management
Self-Help Delivers Earnings Growth Downstream $5.7B Self-Help Raw Material Flexibility Industry Margins Inflation Forex Lower Costs Higher Value Products $1.2B 1999 24
ExxonMobil Delivers Superior Returns Downstream $B 4 Capital Employed XOM RDS BP $B 8 Reported Net Income 6 2 4 2 4 4 4 4 4 4 % Return on Capital Employed* 25 2 15 1 *Calculated based on public information. Note: Impact of Allapattah reserve shown by red hatched box. 5 4 4 4
Taking on the world s toughest energy challenges. Global Refining : Delivering Long-Term Value J. Steve Simon Sr. Vice President, Exxon Mobil Corporation Goldman Sachs Global Energy Conference January 18, 26