UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

 

 

FORM 10-Q

 

 

 

xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended JuneSeptember 30, 2009

or

 

¨TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to            

Commission File Number 1-2256

 

 

EXXON MOBIL CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

NEW JERSEY 13-5409005

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification Number)

5959 Las Colinas Boulevard, Irving, Texas 75039-2298
(Address of principal executive offices) (Zip Code)

(972) 444-1000

(Registrant’s telephone number, including area code)

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer   x  Accelerated filer ¨
Non-accelerated filer ¨  Smaller reporting company   ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Class

  

Outstanding as of JuneSeptember 30, 2009

Common stock, without par value  4,805,790,1414,747,283,776

 

 

 


EXXON MOBIL CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNESEPTEMBER 30, 2009

TABLE OF CONTENTS

 

      Page
Number
PART I. FINANCIAL INFORMATION  

Item 1.

  Financial Statements  

Condensed Consolidated Statement of Income
Three and sixnine months ended JuneSeptember 30, 2009 and 2008

  3

Condensed Consolidated Balance Sheet
As of JuneSeptember 30, 2009 and December 31, 2008

  4

Condensed Consolidated Statement of Cash Flows
SixNine months ended JuneSeptember 30, 2009 and 2008

  5

Notes to Condensed Consolidated Financial Statements

  6

Item 2.

  Management’s Discussion and Analysis of Financial Condition and Results of Operations  16

Item 3.

  Quantitative and Qualitative Disclosures About Market Risk  22

Item 4.

  Controls and Procedures  22
PART II. OTHER INFORMATION  

Item 1.

  Legal Proceedings  22

Item 2.

  Unregistered Sales of Equity Securities and Use of Proceeds  23

Item 4.

Submission of Matters to a Vote of Security Holders24

Item 6.

  Exhibits  2524

Signature

  2625

Index to Exhibits

  2726

 

-2-


PART I. FINANCIAL INFORMATION

 

Item 1.Financial Statements

EXXON MOBIL CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF INCOME

(millions of dollars)

 

  Three Months Ended
June 30,
 Six Months Ended
June 30,
   Three Months Ended
September 30,
  Nine Months Ended
September 30,
  2009 2008 2009  2008   2009  2008  2009  2008

REVENUES AND OTHER INCOME

              

Sales and other operating revenue(1)

  $72,167   $133,776   $134,295  $246,999    $80,090  $132,085  $214,385  $379,084

Income from equity affiliates

   1,583    2,983    3,053   5,792     1,675   2,824   4,728   8,616

Other income(2)

   707    1,313    1,137   2,135     495   2,828   1,632   4,963
                         

Total revenues and other income

   74,457    138,072    138,485   254,926     82,260   137,737   220,745   392,663
                         

COSTS AND OTHER DEDUCTIONS

              

Crude oil and product purchases

   36,903    76,695    64,697   137,666     41,689   73,298   106,386   210,964

Production and manufacturing expenses

   8,029    10,066    16,008   18,959     8,097   9,878   24,105   28,837

Selling, general and administrative expenses

   3,519    4,389    6,967   8,191     3,887   3,823   10,854   12,014

Depreciation and depletion

   3,004    3,090    5,797   6,194     2,927   3,008   8,724   9,202

Exploration expenses, including dry holes

   490    338    841   680     495   403   1,336   1,083

Interest expense

   343    107    450   237     62   318   512   555

Sales-based taxes(1)

   6,216    9,538    12,122   17,970     6,805   9,327   18,927   27,297

Other taxes and duties

   8,436    11,418    16,236   22,124     9,094   10,989   25,330   33,113
                         

Total costs and other deductions

   66,940    115,641    123,118   212,021     73,056   111,044   196,174   323,065
                         

Income before income taxes

   7,517    22,431    15,367   42,905     9,204   26,693   24,571   69,598

Income taxes

   3,571    10,526    6,719   19,828     4,333   11,327   11,052   31,155
                         

Net income including noncontrolling interests

   3,946    11,905    8,648   23,077     4,871   15,366   13,519   38,443

Net income/(loss) attributable to noncontrolling interests

   (4  225    148   507     141   536   289   1,043
                         

Net income attributable to ExxonMobil

  $3,950   $11,680   $8,500  $22,570    $4,730  $14,830  $13,230  $37,400
                         

Earnings per common share (dollars)

  $0.82��  $2.24   $1.74  $4.27    $0.98  $2.86  $2.72  $7.13

Earnings per common share
- assuming dilution (dollars)

  $0.81   $2.22   $1.73  $4.24    $0.98  $2.85  $2.71  $7.09

Dividends per common share (dollars)

  $0.42   $0.40   $0.82  $0.75    $0.42  $0.40  $1.24  $1.15

        

(1) Sales-based taxes included in sales and other operating revenue

  $6,216   $9,538   $12,122  $17,970    $6,805  $9,327  $18,927  $27,297

(2) Includes $62 million gain from sale of non-U.S. investment, net of related $143 million foreign exchange loss

  $0   $(81 $0  $(81  $0  $0  $0  $  (81)

The information in the Notes to Condensed Consolidated Financial Statements

is an integral part of these statements.

 

-3-


EXXON MOBIL CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEET

(millions of dollars)

 

  June 30,
2009
 Dec. 31,
2008
   Sept. 30,
2009
 Dec. 31,
2008
 

ASSETS

      

Current assets

      

Cash and cash equivalents

  $15,576   $31,437    $12,472   $31,437  

Marketable securities

   153    570     151    570  

Notes and accounts receivable - net

   26,862    24,702     26,937    24,702  

Inventories

      

Crude oil, products and merchandise

   9,855    9,331     9,860    9,331  

Materials and supplies

   2,586    2,315     2,725    2,315  

Other current assets

   4,464    3,911     5,179    3,911  
              

Total current assets

   59,496    72,266     57,324    72,266  

Investments, advances and long-term assets

   30,358    28,556     32,064    28,556  

Property, plant and equipment - net

   127,861    121,346     132,874    121,346  

Other assets, including intangibles, net

   6,946    5,884     7,045    5,884  
              

Total assets

  $224,661   $228,052    $229,307   $228,052  
              

LIABILITIES

      

Current liabilities

      

Notes and loans payable

  $2,157   $2,400    $2,418   $2,400  

Accounts payable and accrued liabilities

   41,895    36,643     42,645    36,643  

Income taxes payable

   7,562    10,057     7,870    10,057  
              

Total current liabilities

   51,614    49,100     52,933    49,100  

Long-term debt

   7,117    7,025     7,185    7,025  

Postretirement benefits reserves

   18,287    20,729     18,632    20,729  

Deferred income tax liabilities

   21,880    19,726     23,238    19,726  

Other long-term liabilities

   14,610    13,949     15,214    13,949  
              

Total liabilities

   113,508    110,529     117,202    110,529  
              

Commitments and contingencies (note 3)

      

EQUITY

      

Common stock, without par value:

      

Authorized: 9,000 million shares

      

Issued: 8,019 million shares

   5,260    5,314     5,445    5,314  

Earnings reinvested

   270,160    265,680     272,879    265,680  

Accumulated other comprehensive income

      

Cumulative foreign exchange translation adjustment

   2,676    1,146     4,341    1,146  

Postretirement benefits reserves adjustment

   (10,925  (11,077   (10,721  (11,077

Common stock held in treasury:

      

3,213 million shares at June 30, 2009

   (160,579 

3,272 million shares at September 30, 2009

   (164,679 

3,043 million shares at December 31, 2008

    (148,098    (148,098
              

ExxonMobil share of equity

   106,592    112,965     107,265    112,965  

Noncontrolling interests

   4,561    4,558     4,840    4,558  
              

Total equity

   111,153    117,523     112,105    117,523  
              

Total liabilities and equity

  $224,661   $228,052    $229,307   $228,052  
              

The number of shares of common stock issued and outstanding at JuneSeptember 30, 2009 and December 31, 2008 were 4,805,790,1414,747,283,776 and 4,976,055,639, respectively.

The information in the Notes to Condensed Consolidated Financial Statements

is an integral part of these statements.

 

-4-


EXXON MOBIL CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(millions of dollars)

 

  Six Months Ended
June 30,
   Nine Months Ended
September 30,
 
  2009 2008   2009 2008 

CASH FLOWS FROM OPERATING ACTIVITIES

      

Net income including noncontrolling interests

  $8,648   $23,077    $13,519   $38,443  

Depreciation and depletion

   5,797    6,194     8,724    9,202  

Changes in operational working capital, excluding cash and debt

   (992  7,286     (852  4,430  

All other items - net

   (2,346  (1,719   (1,457  (2,834
              

Net cash provided by operating activities

   11,107    34,838     19,934    49,241  
              

CASH FLOWS FROM INVESTING ACTIVITIES

      

Additions to property, plant and equipment

   (10,238  (8,851   (15,728  (13,993

Sales of subsidiaries, investments, and property, plant and equipment

   911    1,572     1,083    4,202  

Other investing activities - net

   (386  (1,489   (1,352  (3,081
              

Net cash used in investing activities

   (9,713  (8,768   (15,997  (12,872
              

CASH FLOWS FROM FINANCING ACTIVITIES

      

Additions to long-term debt

   145    36     192    177  

Reductions in long-term debt

   (20  (53   (27  (152

Additions/(reductions) in short-term debt - net

   (350  (215   (202  294  

Cash dividends to ExxonMobil shareholders

   (4,020  (3,977   (6,031  (6,040

Cash dividends to noncontrolling interests

   (133  (215   (238  (346

Changes in noncontrolling interests

   (124  (142   (126  (319

Tax benefits related to stock-based awards

   55    150     79    162  

Common stock acquired

   (13,098  (18,226   (17,331  (26,889

Common stock sold

   185    438     296    489  
              

Net cash used in financing activities

   (17,360  (22,204   (23,388  (32,624
              

Effects of exchange rate changes on cash

   105    1,121     486    (1,052
              

Increase/(decrease) in cash and cash equivalents

   (15,861  4,987     (18,965  2,693  

Cash and cash equivalents at beginning of period

   31,437    33,981     31,437    33,981  
              

Cash and cash equivalents at end of period

  $15,576   $38,968    $12,472   $36,674  
              

SUPPLEMENTAL DISCLOSURES

      

Income taxes paid

  $8,540   $15,927    $12,142   $25,194  

Cash interest paid

  $195   $337    $723   $488  

The information in the Notes to Condensed Consolidated Financial Statements

is an integral part of these statements.

 

-5-


EXXON MOBIL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1.Basis of Financial Statement Preparation

These unaudited condensed consolidated financial statements should be read in the context of the consolidated financial statements and notes thereto filed with the Securities and Exchange Commission in the Corporation’s 2008 Annual Report on Form 10-K. In the opinion of the Corporation, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein. All such adjustments are of a normal recurring nature. Subsequent events have been evaluated through AugustNovember 5, 2009, the date the financial statements were issued. The Corporation’s exploration and production activities are accounted for under the “successful efforts” method.

 

2.Accounting Changes

Effective January 1, 2009, ExxonMobil adopted the Financial Accounting Standards Board’s (FASB) Statement No. 157 (FAS 157), “Fair Value Measurements”authoritative guidance for fair value measurements as they relate to nonfinancial assets and liabilities that are measured at fair value on a nonrecurring basis. FAS 157The guidance defines fair value, establishes a framework for measuring fair value when an entity is required to use a fair value measure for recognition or disclosure purposes and expands the disclosures about fair value measures. The adoption did not have a material impact on the Corporation’s financial statements. The Corporation previously adopted FAS 157 forthe guidance as it relates to financial assets and liabilities that are measured at fair value and for nonfinancial assets and liabilities that are measured at fair value on a recurring basis.

Effective January 1, 2009, ExxonMobil adopted Financial Accounting Standards Board’s (FASB) Statement No. 160 (FAS 160), “Noncontrolling Interests in Consolidated Financial Statements – an Amendment of ARB No. 51.” FAS 160the authoritative guidance on consolidation as it relates to noncontrolling interests. The guidance changed the accounting and reporting for minority interests, which were recharacterized as noncontrolling interests and classified as a component of equity. FAS 160 requiredThe guidance requires retrospective adoption of the presentation and disclosure requirements for existing minority interests. All other requirements of FAS 160the guidance will be applied prospectively. The adoption of FAS 160the guidance did not have a material impact on the Corporation’s financial statements.

Effective January 1, 2009, ExxonMobil adopted the Financial Accounting Standards Board’s Staff Position (FSP) on the Emerging Issues Task Force (EITF) Issue No. 03-6-1, “Determining Whether Instruments Grantedauthoritative guidance for earnings per share as it relates to determining whether instruments granted in Share-Based Payment Transactionsshare-based payment transactions are Participating Securities.”participating securities. The FSP requiredguidance requires that all unvested share-based payment awards that contain nonforfeitable rights to dividends should be included in the basic Earnings Per Share (EPS) calculation. Prior-year EPS numbers have been adjusted retrospectively on a consistent basis with 2009 reporting. This standardguidance did not affect the consolidated financial position or results of operations.

 

3.Litigation and Other Contingencies

Litigation

A variety of claims have been made against ExxonMobil and certain of its consolidated subsidiaries in a number of pending lawsuits. Management has regular litigation reviews, including updates from corporate and outside counsel, to assess the need for accounting recognition or disclosure of these contingencies. The Corporation accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. The Corporation does not record liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is reasonably possible and which are significant, the Corporation discloses the nature of the contingency and, where feasible, an estimate of the possible loss. ExxonMobil will continue to defend itself vigorously in these matters. Based on a consideration of all relevant facts and circumstances, the Corporation does not believe the ultimate outcome of any currently pending lawsuit against ExxonMobil will have a materially adverse effect upon the Corporation’s operations or financial condition.

 

-6-


A number of lawsuits, including class actions, were brought in various courts against Exxon Mobil Corporation and certain of its subsidiaries relating to the accidental release of crude oil from the tanker Exxon Valdez in 1989. All the compensatory claims have been resolved and paid. All of the punitive damage claims were consolidated in the civil trial that began in 1994. On June 25, 2008, the U.S. Supreme Court vacated the $2.5 billion punitive damage award previously entered by the Ninth Circuit Court of Appeals and remanded the case to the Circuit Court with an instruction that punitive damages in the case may not exceed a maximum amount of $507.5 million. The parties filed briefs in the Ninth Circuit Court of Appeals on the issue of post-judgment interest and recovery of costs. Exxon Mobil Corporation recorded total after-tax charges of $460 million in 2008 reflecting an estimate of the resolution of these issues.

On June 15, 2009, the U. S. Court of Appeals for the Ninth Circuit awarded plaintiffs in the Valdez litigation interest on the $507.5 million punitive damages award has been paid, except for $70 million which has been withheld pending final resolution of ExxonMobil’s claim to recover appeal costs. All interest has been paid on the award from the date of the original trial court judgment in 1996. The Court also denied the Corporation’s claims to recover up to $701996 through July 1, 2009. After-tax charges of $460 million in appeal costs. An after-tax charge of2008 and $140 million was recorded in the second quarter of 2009 to reflectwere taken reflecting the Court’s decision.court decisions on punitive damages and interest.

Other Contingencies

 

   As of June 30, 2009
   Equity
Company
Obligations
  Other
Third Party
Obligations
  Total
   (millions of dollars)

Total guarantees

  $6,599  $1,985  $8,584
   As of September 30, 2009
   Equity
Company
Obligations
  Other
Third Party
Obligations
  Total
   (millions of dollars)

Total guarantees

  $6,635  $2,252  $8,887

The Corporation and certain of its consolidated subsidiaries were contingently liable at JuneSeptember 30, 2009, for $8,584$8,887 million, primarily relating to guarantees for notes, loans and performance under contracts. Included in this amount were guarantees by consolidated affiliates of $6,599$6,635 million, for ExxonMobil’s share of obligations of certain equity companies. These guarantees are not reasonably likely to have a material effect on the Corporation’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Additionally, the Corporation and its affiliates have numerous long-term sales and purchase commitments in their various business activities, all of which are expected to be fulfilled with no adverse consequences material to the Corporation’s operations or financial condition. The Corporation’s outstanding unconditional purchase obligations at JuneSeptember 30, 2009, were similar to those at the prior year-end period. Unconditional purchase obligations as defined by accounting standardsguidance are those long-term commitments that are noncancelable or cancelable only under certain conditions, and that third parties have used to secure financing for the facilities that will provide the contracted goods or services.

The operations and earnings of the Corporation and its affiliates throughout the world have been, and may in the future be, affected from time to time in varying degree by political developments and laws and regulations, such as forced divestiture of assets; restrictions on production, imports and exports; price controls; tax increases and retroactive tax claims; expropriation of property; cancellation of contract rights and environmental regulations. Both the likelihood of such occurrences and their overall effect upon the Corporation vary greatly from country to country and are not predictable.

In accordance with a nationalization decree issued by Venezuela’s president in February 2007, by May 1, 2007, a subsidiary of the Venezuelan National Oil Company (PdVSA) assumed the operatorship of the Cerro Negro Heavy Oil Project. This Project had been operated and owned by ExxonMobil affiliates holding a 41.67 percent ownership interest in the Project. The decree also required conversion of the Cerro Negro Project into a “mixed enterprise” and an increase in PdVSA’s or one of its affiliate’s ownership interest in the Project, with the stipulation that if ExxonMobil refused to accept the terms for the formation of the mixed enterprise within a specified period of time, the government would “directly assume the activities” carried out by the joint venture. ExxonMobil refused to accede to the terms proffered by the government, and on June 27, 2007, the government expropriated ExxonMobil’s 41.67 percent interest in the Cerro Negro Project.

On September 6, 2007, affiliates of ExxonMobil filed a Request for Arbitration with the International Centre for Settlement of Investment Disputes. An affiliate of ExxonMobil has also filed an arbitration under the rules of the International Chamber of Commerce against PdVSA and a PdVSA affiliate for breach of their contractual obligations under certain Cerro Negro Project agreements. At this time, the net impact of this matter on the Corporation’s consolidated financial results cannot be reasonably estimated. However, the Corporation does not expect the resolution to have a material effect upon the Corporation’s operations or financial condition. ExxonMobil’s remaining net book investment in Cerro Negro producing assets is about $750 million.

 

-7-


4.Comprehensive Income

 

 Three Months Ended
June 30,
 Six Months Ended
June 30,
   Three Months Ended
September 30,
 Nine Months Ended
September 30,
 
 2009 2008 2009 2008   2009 2008 2009 2008 
 (millions of dollars)   (millions of dollars) 

Net income including noncontrolling interests

 $3,946   $11,905   $8,648   $23,077    $4,871   $15,366   $13,519   $38,443  

Other comprehensive income (net of income taxes)

         

Foreign exchange translation adjustment

  3,035    (110  1,624    1,602     1,932    (4,410  3,556    (2,808

Adjustment for foreign exchange translation loss included in net income

  0    171    0    171     0    0    0    171  

Postretirement benefits reserves adjustment (excluding amortization)

  (492  (107  (534  (247   (156  219    (690  (28

Amortization of postretirement benefits reserves adjustment included in net periodic benefit costs

  354    186    704    375     338    176    1,042    551  
                         

Comprehensive income including noncontrolling interests

  6,843    12,045    10,442    24,978     6,985    11,351    17,427    36,329  

Comprehensive income attributable to noncontrolling interests

  242    22    260    550     386    429    646    979  
                         

Comprehensive income attributable to ExxonMobil

 $6,601   $12,023   $10,182   $24,428    $6,599   $10,922   $16,781   $35,350  
                         

 

5.Earnings Per Share

 

  Three Months Ended
June 30,
  Six Months Ended
June 30,
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
  2009  2008  2009  2008  2009  2008  2009  2008

EARNINGS PER COMMON SHARE

                

Net income attributable to ExxonMobil (millions of dollars)

  $3,950  $11,680  $8,500  $22,570  $4,730  $14,830  $13,230  $37,400

Weighted average number of common shares outstanding (millions of shares)

   4,851   5,248   4,896   5,296   4,784   5,149   4,859   5,247

Earnings per common share (dollars)

  $0.82  $2.24  $1.74  $4.27  $0.98  $2.86  $2.72  $7.13

EARNINGS PER COMMON SHARE - ASSUMING DILUTION

                

Net income attributable to ExxonMobil (millions of dollars)

  $3,950  $11,680  $8,500  $22,570  $4,730  $14,830  $13,230  $37,400

Weighted average number of common shares outstanding (millions of shares)

   4,851   5,248   4,896   5,296   4,784   5,149   4,859   5,247

Effect of employee stock-based awards

   20   33   20   33   19   29   19   31
                        

Weighted average number of common shares outstanding - assuming dilution

   4,871   5,281   4,916   5,329   4,803   5,178   4,878   5,278
                        

Earnings per common share - assuming dilution (dollars)

  $0.81  $2.22  $1.73  $4.24  $0.98  $2.85  $2.71  $7.09

 

-8-


6.Pension and Other Postretirement Benefits

 

  Three Months Ended
June 30,
 Six Months Ended
June 30,
   Three Months Ended
September 30,
 Nine Months Ended
September 30,
 
  2009 2008 2009 2008   2009 2008 2009 2008 
  (millions of dollars)   (millions of dollars) 

Pension Benefits - U.S.

          

Components of net benefit cost

          

Service cost

  $106   $96   $209   $191    $116   $96   $325   $287  

Interest cost

   202    182    404    364     202    181    606    545  

Expected return on plan assets

   (164  (229  (328  (458   (165  (228  (493  (686

Amortization of actuarial loss/(gain) and prior service cost

   174    59    347    118     174    60    521    178  

Net pension enhancement and curtailment/settlement cost

   121    43    242    87     122    44    364    131  
                          

Net benefit cost

  $439   $151   $874   $302    $449   $153   $1,323   $455  
                          

Pension Benefits - Non-U.S.

          

Components of net benefit cost

          

Service cost

  $100   $114   $203   $227    $111   $107   $314   $334  

Interest cost

   275    305    536    606     287    294    823    900  

Expected return on plan assets

   (216  (317  (421  (635   (227  (308  (648  (943

Amortization of actuarial loss/(gain) and prior service cost

   177    109    344    210     184    103    528    313  

Net pension enhancement and curtailment/settlement cost

   0    2    0    2     0    0    0    2  
                          

Net benefit cost

  $336   $213   $662   $410    $355   $196   $1,017   $606  
                          

Other Postretirement Benefits

          

Components of net benefit cost

          

Service cost

  $23   $28   $50   $57    $22   $23   $72   $80  

Interest cost

   104    129    214    237     98    92    312    329  

Expected return on plan assets

   (2  (22  (18  (34   (9  (13  (27  (47

Amortization of actuarial loss/(gain) and prior service cost

   58    72    129    156     59    61    188    217  
                          

Net benefit cost

  $183   $207   $375   $416    $170   $163   $545   $579  
                          

 

7.Financial Instruments and Derivatives

The fair value of financial instruments is determined by reference to variousobservable market data and other valuation techniques as appropriate. The only category of financial instruments where the difference between fair value and recorded book value is of significance is long-term debt. The estimated fair value of total long-term debt, including capitalized lease obligations, was $7.8 billion and $7.6 billion, at JuneSeptember 30, 2009 and December 31, 2008, respectively, as compared to recorded book values of $7.1$7.2 billion and $7.0 billion at JuneSeptember 30, 2009 and December 31, 2008, respectively.

The estimated fair value of derivatives outstanding and recorded on the balance sheet was a net payable of $122$4 million and a net receivable of $118 million on JuneSeptember 30, 2009 and December 31, 2008, respectively. The Corporation would have paid or received this amount from third parties if these derivatives had been settled in the open market based on observable market inputs.

The fair value of derivatives outstanding at JuneSeptember 30, 2009, is immaterial in relation to total assets of $225$229 billion or net income attributable to ExxonMobil for the sixnine months ended JuneSeptember 30, 2009, of $8.5$13.2 billion.

 

-9-


8.Disclosures about Segments and Related Information

 

  Three Months Ended
June 30,
 Six Months Ended
June 30,
   Three Months Ended
September 30,
 Nine Months Ended
September 30,
 
  2009 2008 2009 2008   2009 2008 2009 2008 
  (millions of dollars)   (millions of dollars) 

EARNINGS AFTER INCOME TAX

          

Upstream

          

United States

  $813   $2,034   $1,173   $3,665    $709   $1,879   $1,882   $5,544  

Non-U.S.

   2,999    7,978    6,142    15,132     3,303    9,092    9,445    24,224  

Downstream

          

United States

   (15  293    337    691     (203  978    134    1,669  

Non-U.S.

   527    1,265    1,308    2,033     528    2,035    1,836    4,068  

Chemical

          

United States

   79    102    162    386     315    257    477    643  

Non-U.S.

   288    585    555    1,329     561    830    1,116    2,159  

All other

   (741  (577  (1,177  (666   (483  (241  (1,660  (907
                          

Corporate total

  $3,950   $11,680   $8,500   $22,570    $4,730   $14,830   $13,230   $37,400  
                          

SALES AND OTHER OPERATING REVENUE(1)

          

Upstream

          

United States

  $753   $2,010   $1,574   $3,774    $833   $1,784   $2,407   $5,558  

Non-U.S.

   5,101    8,989    10,277    17,388     4,987    8,230    15,264    25,618  

Downstream

          

United States

   18,853    36,066    34,046    64,524     20,568    33,038    54,614    97,562  

Non-U.S.

   41,238    75,667    77,223    140,184     46,112    78,168    123,335    218,352  

Chemical

          

United States

   2,317    4,170    4,165    7,822     2,857    4,011    7,022    11,833  

Non-U.S.

   3,897    6,870    7,000    13,299     4,726    6,851    11,726    20,150  

All other

   8    4    10    8     7    3    17    11  
                          

Corporate total

  $72,167   $133,776   $134,295   $246,999    $80,090   $132,085   $214,385   $379,084  
                          

(1) Includes sales-based taxes

(1) Includes sales-based taxes

       

     

INTERSEGMENT REVENUE

          

Upstream

          

United States

  $1,615   $3,072   $2,819   $5,633    $1,752   $2,604   $4,571   $8,237  

Non-U.S.

   7,250    17,260    13,826    32,141     9,446    17,160    23,272    49,301  

Downstream

          

United States

   2,568    5,241    4,237    9,102     2,930    4,866    7,167    13,968  

Non-U.S.

   9,525    21,406    16,404    37,949     10,923    19,132    27,327    57,081  

Chemical

          

United States

   1,834    3,177    3,055    5,605     1,980    2,902    5,035    8,507  

Non-U.S.

   1,647    2,670    2,931    5,102     1,941    2,959    4,872    8,061  

All other

   72    71    143    138     70    68    213    206  

9.Accounting for Suspended Exploratory Well Costs

For the category of exploratory well costs at year-end 2008 that were suspended more than one year, a total of $51 million was expensed in the first nine months of 2009.

 

-10-


9.10.Condensed Consolidating Financial Information Related to Guaranteed Securities Issued by Subsidiaries

Exxon Mobil Corporation has fully and unconditionally guaranteed the deferred interest debentures due 2012 ($2,0342,089 million long-term at JuneSeptember 30, 2009) and the debt securities due 2009-2011 ($26 million long-term and $13 million short-term) of SeaRiver Maritime Financial Holdings, Inc., a 100 percent owned subsidiary of Exxon Mobil Corporation.

The following condensed consolidating financial information is provided for Exxon Mobil Corporation, as guarantor, and for SeaRiver Maritime Financial Holdings, Inc., as issuer, as an alternative to providing separate financial statements for the issuer. The accounts of Exxon Mobil Corporation and SeaRiver Maritime Financial Holdings, Inc. are presented utilizing the equity method of accounting for investments in subsidiaries.

 

  Exxon Mobil
Corporation
Parent
Guarantor
 SeaRiver
Maritime
Financial
Holdings
Inc.
 All Other
Subsidiaries
 Consolidating
and
Eliminating
Adjustments
 Consolidated   Exxon Mobil
Corporation
Parent
Guarantor
   SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
   Consolidated
  (millions of dollars)   (millions of dollars)

Condensed consolidated statement of income for three months ended June 30, 2009

  

Condensed consolidated statement of income for three months ended September 30, 2009

Condensed consolidated statement of income for three months ended September 30, 2009

Revenues and other income

                

Sales and other operating revenue, including sales-based taxes

  $2,633   $—     $69,534   $—     $72,167    $3,207    $—      $76,883  $—      $80,090

Income from equity affiliates

   4,271    (3  1,560    (4,245  1,583     5,238     1     1,648   (5,212   1,675

Other income

   440    — ��    267    —      707     170     —       325   —       495

Intercompany revenue

   7,441    1    64,665    (72,107  —       8,067     1     74,420   (82,488   —  
                                  

Total revenues and other income

   14,785    (2  136,026    (76,352  74,457     16,682     2     153,276   (87,700   82,260
                                  

Costs and other deductions

                

Crude oil and product purchases

   7,511    —      98,426    (69,034  36,903     8,844     —       112,285   (79,440   41,689

Production and manufacturing expenses

   1,913    —      7,458    (1,342  8,029     1,924     —       7,681   (1,508   8,097

Selling, general and administrative expenses

   560    —      3,128    (169  3,519     783     —       3,289   (185   3,887

Depreciation and depletion

   361    —      2,643    —      3,004     405     —       2,522   —       2,927

Exploration expenses, including dry holes

   77    —      413    —      490     59     —       436   —       495

Interest expense

   597    56    1,272    (1,582  343     174     55     1,208   (1,375   62

Sales-based taxes

   —      —      6,216    —      6,216     —       —       6,805   —       6,805

Other taxes and duties

   (43  —      8,479    —      8,436     4     —       9,090   —       9,094
                                  

Total costs and other deductions

   10,976    56    128,035    (72,127  66,940     12,193     55     143,316   (82,508   73,056
                                  

Income before income taxes

   3,809    (58  7,991    (4,225  7,517     4,489     (53   9,960   (5,192   9,204

Income taxes

   (141  (21  3,733    —      3,571     (241   (20   4,594   —       4,333
                                  

Net income including noncontrolling interests

   3,950    (37  4,258    (4,225  3,946     4,730     (33   5,366   (5,192   4,871

Net income attributable to noncontrolling interests

   —      —      (4  —      (4   —       —       141   —       141
                                  

Net income attributable to ExxonMobil

  $3,950   $(37 $4,262   $(4,225 $3,950    $4,730    $(33  $5,225  $(5,192  $4,730
                                  

 

-11-


  Exxon Mobil
Corporation
Parent
Guarantor
   SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
   Consolidated  Exxon Mobil
Corporation
Parent
Guarantor
   SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
   Consolidated
  (millions of dollars)  (millions of dollars)

Condensed consolidated statement of income for three months ended June 30, 2008

Condensed consolidated statement of income for three months ended September 30, 2008

Condensed consolidated statement of income for three months ended September 30, 2008

  

  

Revenues and other income

                    

Sales and other operating revenue, including sales-based taxes

  $5,214    $—      $128,562  $—      $133,776  $4,859    $—      $127,226  $—      $132,085

Income from equity affiliates

   11,765     (3   2,977   (11,756   2,983   14,267     5     2,819   (14,267   2,824

Other income

   100     —       1,213   —       1,313   81     —       2,747   —       2,828

Intercompany revenue

   15,052     11     132,434   (147,497   —     13,636     11     128,749   (142,396   —  
                                    

Total revenues and other income

   32,131     8     265,186   (159,253   138,072   32,843     16     261,541   (156,663   137,737
                                    

Costs and other deductions

                    

Crude oil and product purchases

   15,519     —       203,434   (142,258   76,695   13,164     —       196,879   (136,745   73,298

Production and manufacturing expenses

   2,293     —       9,210   (1,437   10,066   2,067     —       9,286   (1,475   9,878

Selling, general and administrative expenses

   1,194     —       3,401   (206   4,389   734     —       3,315   (226   3,823

Depreciation and depletion

   379     —       2,711   —       3,090   360     —       2,648   —       3,008

Exploration expenses, including dry holes

   67     —       271   —       338   70     —       333   —       403

Interest expense

   739     52     3,019   (3,703   107   901     52     3,411   (4,046   318

Sales-based taxes

   —       —       9,538   —       9,538   —       —       9,327   —       9,327

Other taxes and duties

   16     —       11,402   —       11,418   18     —       10,971   —       10,989
                                    

Total costs and other deductions

   20,207     52     242,986   (147,604   115,641   17,314     52     236,170   (142,492   111,044
                                    

Income before income taxes

   11,924     (44   22,200   (11,649   22,431   15,529     (36   25,371   (14,171   26,693

Income taxes

   244     (15   10,297   —       10,526   699     (14   10,642   —       11,327
                                    

Net income including noncontrolling interests

   11,680     (29   11,903   (11,649   11,905   14,830     (22   14,729   (14,171   15,366

Net income attributable to noncontrolling interests

   —       —       225   —       225   —       —       536   —       536
                                    

Net income attributable to ExxonMobil

  $11,680    $(29  $11,678  $(11,649  $11,680  $14,830    $(22  $14,193  $(14,171  $14,830
                                    

Condensed consolidated statement of income for six months ended June 30, 2009

Condensed consolidated statement of income for nine months ended September 30, 2009

Condensed consolidated statement of income for nine months ended September 30, 2009

  

  

Revenues and other income

                    

Sales and other operating revenue, including sales-based taxes

  $4,800    $—      $129,495  $—      $134,295  $8,007    $—      $206,378  $—      $214,385

Income from equity affiliates

   9,023     4     3,010   (8,984   3,053   14,261     5     4,658   (14,196   4,728

Other income

   585     —       552   —       1,137   755     —       877   —       1,632

Intercompany revenue

   13,306     2     117,300   (130,608   —     21,373     3     191,720   (213,096   —  
                                    

Total revenues and other income

   27,714     6     250,357   (139,592   138,485   44,396     8     403,633   (227,292   220,745
                                    

Costs and other deductions

                    

Crude oil and product purchases

   12,585     —       176,277   (124,165   64,697   21,429     —       288,562   (203,605   106,386

Production and manufacturing expenses

   3,879     —       14,752   (2,623   16,008   5,803     —       22,433   (4,131   24,105

Selling, general and administrative expenses

   1,218     —       6,096   (347   6,967   2,001    ��—       9,385   (532   10,854

Depreciation and depletion

   728     —       5,069   —       5,797   1,133     —       7,591   —       8,724

Exploration expenses, including dry holes

   132     —       709   —       841   191     —       1,145   —       1,336

Interest expense

   958     111     2,894   (3,513   450   1,132     166     4,102   (4,888   512

Sales-based taxes

   —       —       12,122   —       12,122   —       —       18,927   —       18,927

Other taxes and duties

   (34   —       16,270   —       16,236   (30   —       25,360   —       25,330
                                    

Total costs and other deductions

   19,466     111     234,189   (130,648   123,118   31,659     166     377,505   (213,156   196,174
                                    

Income before income taxes

   8,248     (105   16,168   (8,944   15,367   12,737     (158   26,128   (14,136   24,571

Income taxes

   (252   (41   7,012   —       6,719   (493   (61   11,606   —       11,052
                                    

Net income including noncontrolling interests

   8,500     (64   9,156   (8,944   8,648   13,230     (97   14,522   (14,136   13,519

Net income attributable to noncontrolling interests

   —       —       148   —       148   —       —       289   —       289
                                    

Net income attributable to ExxonMobil

  $8,500    $(64  $9,008  $(8,944  $8,500  $13,230    $(97  $14,233  $(14,136  $13,230
                                    

 

-12-


  Exxon Mobil
Corporation
Parent
Guarantor
  SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
   Consolidated  Exxon Mobil
Corporation
Parent
Guarantor
  SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
   Consolidated
  (millions of dollars)  (millions of dollars)

Condensed consolidated statement of income for six months ended June 30, 2008

Condensed consolidated statement of income for nine months ended September 30, 2008

Condensed consolidated statement of income for nine months ended September 30, 2008

  

  

Revenues and other income

                    

Sales and other operating revenue, including sales-based taxes

  $9,729  $—      $237,270  $—      $246,999  $14,588  $—      $364,496  $—      $379,084

Income from equity affiliates

   22,833   (2   5,775   (22,814   5,792   37,100   3     8,594   (37,081   8,616

Other income

   125   —       2,010   —       2,135   206   —       4,757   —       4,963

Intercompany revenue

   26,652   28     245,034   (271,714   —     40,288   39     373,783   (414,110   —  
                                  

Total revenues and other income

   59,339   26     490,089   (294,528   254,926   92,182   42     751,630   (451,191   392,663
                                  

Costs and other deductions

                    

Crude oil and product purchases

   27,369   —       370,676   (260,379   137,666   40,533   —       567,555   (397,124   210,964

Production and manufacturing expenses

   4,204   —       17,539   (2,784   18,959   6,271   —       26,825   (4,259   28,837

Selling, general and administrative expenses

   1,896   —       6,714   (419   8,191   2,630   —       10,029   (645   12,014

Depreciation and depletion

   772   —       5,422   —       6,194  ��1,132   —       8,070   —       9,202

Exploration expenses, including dry holes

   146   —       534   —       680   216   —       867   —       1,083

Interest expense

   1,933   105     6,529   (8,330   237   2,834   157     9,940   (12,376   555

Sales-based taxes

   —     —       17,970   —       17,970   —     —       27,297   —       27,297

Other taxes and duties

   31   —       22,093   —       22,124   49   —       33,064   —       33,113
                                  

Total costs and other deductions

   36,351   105     447,477   (271,912   212,021   53,665   157     683,647   (414,404   323,065
                                  

Income before income taxes

   22,988   (79   42,612   (22,616   42,905   38,517   (115   67,983   (36,787   69,598

Income taxes

   418   (27   19,437   —       19,828   1,117   (41   30,079   —       31,155
                                  

Net income including noncontrolling interests

   22,570   (52   23,175   (22,616   23,077   37,400   (74   37,904   (36,787   38,443

Net income attributable to noncontrolling interests

   —     —       507   —       507   —     —       1,043   —       1,043
                                  

Net income attributable to ExxonMobil

  $22,570  $(52  $22,668  $(22,616  $22,570  $37,400  $(74  $36,861  $(36,787  $37,400
                                  

 

-13-


  Exxon Mobil
Corporation
Parent
Guarantor
   SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
   Consolidated   Exxon Mobil
Corporation
Parent
Guarantor
 SeaRiver
Maritime
Financial
Holdings
Inc.
 All Other
Subsidiaries
  Consolidating
and
Eliminating
Adjustments
 Consolidated 
  (millions of dollars)   (millions of dollars)   

Condensed consolidated balance sheet as of June 30, 2009

  

Condensed consolidated balance sheet as of September 30, 2009

Condensed consolidated balance sheet as of September 30, 2009

  

Cash and cash equivalents

  $960    $—      $14,616  $—      $15,576    $147   $—     $12,325  $—     $12,472  

Marketable securities

   —       —       153   —       153     —      —      151   —      151  

Notes and accounts receivable - net

   4,129     27     25,275   (2,569   26,862     3,921    32    25,285   (2,301  26,937  

Inventories

   1,325     —       11,116   —       12,441     1,291    —      11,294   —      12,585  

Other current assets

   482     —       3,982   —       4,464     393    —      4,786   —      5,179  
                                   

Total current assets

   6,896     27     55,142   (2,569   59,496     5,752    32    53,841   (2,301  57,324  

Property, plant and equipment - net

   17,502     —       110,359   —       127,861     17,751    —      115,123   —      132,874  

Investments and other assets

   213,132     473     446,136   (622,437   37,304     220,571    484    457,297   (639,243  39,109  

Intercompany receivables

   8,630     2,208     442,365   (453,203   —       8,434    2,199    445,308   (455,941  —    
                                   

Total assets

  $246,160    $2,708    $1,054,002  $(1,078,209  $224,661    $252,508   $2,715   $1,071,569  $(1,097,485 $229,307  
                                   

Notes and loan payables

  $10    $13    $2,134  $—      $2,157    $7   $13   $2,398  $—     $2,418  

Accounts payable and accrued liabilities

   3,463     —       38,432   —       41,895     3,356    —      39,289   —      42,645  

Income taxes payable

   —       —       10,131   (2,569   7,562     —      —      10,171   (2,301  7,870  
                                   

Total current liabilities

   3,473     13     50,697   (2,569   51,614     3,363    13    51,858   (2,301  52,933  

Long-term debt

   279     2,060     4,778   —       7,117     279    2,115    4,791   —      7,185  

Postretirement benefits reserves

   9,284     —       9,003   —       18,287     9,351    —      9,281   —      18,632  

Deferred income tax liabilities

   1,260     162     20,458   —       21,880     1,399    147    21,692   —      23,238  

Other long-term liabilities

   5,106     —       9,504   —       14,610     5,236    —      9,978   —      15,214  

Intercompany payables

   120,166     382     332,655   (453,203   —       125,615    382    329,944   (455,941  —    
                                   

Total liabilities

   139,568     2,617     427,095   (455,772   113,508     145,243    2,657    427,544   (458,242  117,202  
                                   

Earnings reinvested

   270,160     (628   125,625   (124,997   270,160     272,879    (661  130,760   (130,099  272,879  

Other ExxonMobil equity

   (163,568   719     496,721   (497,440   (163,568   (165,614  719    508,425   (509,144  (165,614
                                   

ExxonMobil share of equity

   106,592     91     622,346   (622,437   106,592     107,265    58    639,185   (639,243  107,265  

Noncontrolling interests

   —       —       4,561   —       4,561     —      —      4,840   —      4,840  
                                   

Total equity

   106,592     91     626,907   (622,437   111,153     107,265    58    644,025   (639,243  112,105  
                                   

Total liabilities and equity

  $246,160    $2,708    $1,054,002  $(1,078,209  $224,661    $252,508   $2,715   $1,071,569  $(1,097,485 $229,307  
                                   

Condensed consolidated balance sheet as of December 31, 2008

Condensed consolidated balance sheet as of December 31, 2008

  

Condensed consolidated balance sheet as of December 31, 2008

  

Cash and cash equivalents

  $4,011    $—      $27,426  $—      $31,437    $4,011   $—     $27,426  $—     $31,437  

Marketable securities

   —       —       570   —       570     —      —      570   —      570  

Notes and accounts receivable - net

   2,486     3     23,224   (1,011   24,702     2,486    3    23,224   (1,011  24,702  

Inventories

   1,253     —       10,393   —       11,646     1,253    —      10,393   —      11,646  

Other current assets

   348     —       3,563   —       3,911     348    —      3,563   —      3,911  
                                   

Total current assets

   8,098     3     65,176   (1,011   72,266     8,098    3    65,176   (1,011  72,266  

Property, plant and equipment - net

   16,939     —       104,407   —       121,346     16,939    —      104,407   —      121,346  

Investments and other assets

   202,471     469     456,237   (624,737   34,440     202,471    469    456,237   (624,737  34,440  

Intercompany receivables

   10,026     2,057     432,902   (444,985   —       10,026    2,057    432,902   (444,985  —    
                                   

Total assets

  $237,534    $2,529    $1,058,722  $(1,070,733  $228,052    $237,534   $2,529   $1,058,722  $(1,070,733 $228,052  
                                   

Notes and loan payables

  $7    $13    $2,380  $—      $2,400    $7   $13   $2,380  $—     $2,400  

Accounts payable and accrued liabilities

   3,352     —       33,291   —       36,643     3,352    —      33,291   —      36,643  

Income taxes payable

   —       —       11,068   (1,011   10,057     —      —      11,068   (1,011  10,057  
                                   

Total current liabilities

   3,359     13     46,739   (1,011   49,100     3,359    13    46,739   (1,011  49,100  

Long-term debt

   279     1,951     4,795   —       7,025     279    1,951    4,795   —      7,025  

Postretirement benefits reserves

   11,653     —       9,076   —       20,729     11,653    —      9,076   —      20,729  

Deferred income tax liabilities

   120     178     19,428   —       19,726     120    178    19,428   —      19,726  

Other long-term liabilities

   5,175     —       8,774   —       13,949     5,175    —      8,774   —      13,949  

Intercompany payables

   103,983     382     340,620   (444,985   —       103,983    382    340,620   (444,985  —    
                                   

Total liabilities

   124,569     2,524     429,432   (445,996   110,529     124,569    2,524    429,432   (445,996  110,529  
                                   

Earnings reinvested

   265,680     (564   116,805   (116,241   265,680     265,680    (564  116,805   (116,241  265,680  

Other ExxonMobil equity

   (152,715   569     507,927   (508,496   (152,715   (152,715  569    507,927   (508,496  (152,715
                                   

ExxonMobil share of equity

   112,965     5     624,732   (624,737   112,965     112,965    5    624,732   (624,737  112,965  

Noncontrolling interests

   —       —       4,558   —       4,558     —      —      4,558   —      4,558  
                                   

Total equity

   112,965     5     629,290   (624,737   117,523     112,965    5    629,290   (624,737  117,523  
                                   

Total liabilities and equity

  $237,534    $2,529    $1,058,722  $(1,070,733  $228,052    $237,534   $2,529   $1,058,722  $(1,070,733 $228,052  
                                   

 

-14-


  Exxon Mobil
Corporation
Parent
Guarantor
   SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
   Consolidating
and
Eliminating
Adjustments
   Consolidated   Exxon Mobil
Corporation
Parent
Guarantor
   SeaRiver
Maritime
Financial
Holdings
Inc.
   All Other
Subsidiaries
   Consolidating
and
Eliminating
Adjustments
   Consolidated 
  (millions of dollars)   (millions of dollars) 
Condensed consolidated statement of cash flows for six months ended June 30, 2009  
Condensed consolidated statement of cash flows for nine months ended September 30, 2009Condensed consolidated statement of cash flows for nine months ended September 30, 2009  

Cash provided by/(used in) operating activities

  $(2,130  $1    $13,424    $(188  $11,107    $(1,554  $2    $21,764    $(278  $19,934  
                                        

Cash flows from investing activities

                    

Additions to property, plant and equipment

   (1,321   —       (8,917   —       (10,238   (1,999   —       (13,729   —       (15,728

Sales of long-term assets

   97     —       814     —       911     191     —       892     —       1,083  

Net intercompany investing

   17,178     (151   (17,349   322     —       22,485     (152   (22,646   313     —    

All other investing, net

   —       —       (386   —       (386   —       —       (1,352   —       (1,352
                                        

Net cash provided by/(used in) investing activities

   15,954     (151   (25,838   322     (9,713   20,677     (152   (36,835   313     (15,997
                                        

Cash flows from financing activities

                    

Additions to long-term debt

   —       —       145     —       145     —       —       192     —       192  

Reductions in long-term debt

   —       —       (20   —       (20   —       —       (27   —       (27

Additions/(reductions) in short-term debt - net

   3     —       (353   —       (350

Additions/(reductions) in short-term debt—net

   —       —       (202   —       (202

Cash dividends

   (4,020   —       (188   188     (4,020   (6,031   —       (278   278     (6,031

Net ExxonMobil shares sold/(acquired)

   (12,913   —       —       —       (12,913   (17,035   —       —       —       (17,035

Net intercompany financing activity

   —       —       172     (172   —       —       —       163     (163   —    

All other financing, net

   55     150     (257   (150   (202   79     150     (364   (150   (285
                                        

Net cash provided by/(used in) financing activities

   (16,875   150     (501   (134   (17,360   (22,987   150     (516   (35   (23,388
                                        

Effects of exchange rate changes on cash

   —       —       105     —       105     —       —       486     —       486  
                                        

Increase/(decrease) in cash and cash equivalents

  $(3,051  $—      $(12,810  $—      $(15,861  $(3,864  $—      $(15,101  $—      $(18,965
                                        

Condensed consolidated statement of cash flows for six months ended June 30, 2008

  

Condensed consolidated statement of cash flows for nine months ended September 30, 2008

Condensed consolidated statement of cash flows for nine months ended September 30, 2008

  

Cash provided by/(used in) operating activities

  $22,935    $21    $34,334    $(22,452  $34,838    $25,019    $29    $46,979    $(22,786  $49,241  
                                        

Cash flows from investing activities

                    

Additions to property, plant and equipment

   (835   —       (8,016   —       (8,851   (1,489   —       (12,504   —       (13,993

Sales of long-term assets

   98     —       1,474     —       1,572     138     —       4,064     —       4,202  

Net intercompany investing

   (2,008   (122   1,961     169     —       9,600     (130   (9,647   177     —    

All other investing, net

   —       —       (1,489   —       (1,489   —       —       (3,081   —       (3,081
                                        

Net cash provided by/(used in) investing activities

   (2,745   (122   (6,070   169     (8,768   8,249     (130   (21,168   177     (12,872
                                        

Cash flows from financing activities

                    

Additions to long-term debt

   —       —       36     —       36     —       —       177     —       177  

Reductions in long-term debt

   —       —       (53   —       (53   —       —       (152   —       (152

Additions/(reductions) in short-term debt - net

   147     —       (362   —       (215

Additions/(reductions) in short-term debt—net

   29     —       265     —       294  

Cash dividends

   (3,977   —       (22,452   22,452     (3,977   (6,040   —       (22,786   22,786     (6,040

Net ExxonMobil shares sold/(acquired)

   (17,788   —       —       —       (17,788   (26,400   —       —       —       (26,400

Net intercompany financing activity

   —       1     68     (69   —       —       1     76     (77   —    

All other financing, net

   150     100     (357   (100   (207   161     100     (664   (100   (503
                                        

Net cash provided by/(used in) financing activities

   (21,468   101     (23,120   22,283     (22,204   (32,250   101     (23,084   22,609     (32,624
                                        

Effects of exchange rate changes on cash

   —       —       1,121     —       1,121     —       —       (1,052   —       (1,052
                                        

Increase/(decrease) in cash and cash equivalents

  $(1,278  $—      $6,265    $—      $4,987    $1,018    $—      $1,675    $—      $2,693  
                                        

 

-15-


EXXON MOBIL CORPORATION

 

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

FUNCTIONAL EARNINGS SUMMARY

 

  Second Quarter First Six Months   Third Quarter First Nine Months 

Earnings (U.S. GAAP)

  2009 2008 2009 2008   2009 2008 2009 2008 
  (millions of dollars)   (millions of dollars) 

Upstream

          

United States

  $813   $2,034   $1,173   $3,665    $709   $1,879   $1,882   $5,544  

Non-U.S.

   2,999    7,978    6,142    15,132     3,303    9,092    9,445    24,224  

Downstream

          

United States

   (15  293    337    691     (203  978    134    1,669  

Non-U.S.

   527    1,265    1,308    2,033     528    2,035    1,836    4,068  

Chemical

          

United States

   79    102    162    386     315    257    477    643  

Non-U.S.

   288    585    555    1,329     561    830    1,116    2,159  

Corporate and financing

   (741  (577  (1,177  (666   (483  (241  (1,660  (907
                          

Net Income attributable to ExxonMobil (U.S. GAAP)

  $3,950   $11,680   $8,500   $22,570    $4,730   $14,830   $13,230   $37,400  
                          

Earnings per common share (dollars)

  $0.82   $2.24   $1.74   $4.27    $0.98   $2.86   $2.72   $7.13  

Earnings per common share - assuming dilution (dollars)

  $0.81   $2.22   $1.73   $4.24    $0.98   $2.85   $2.71   $7.09  

Special items included in earnings

          

Non-U.S. Upstream

     

Sale of German gas transportation business

  $0   $1,620   $0   $1,620  

Corporate and financing

          

Valdez litigation

  $(140 $(290 $(140 $(290  $0   $(170 $(140 $(460

References in this discussion to total corporate earnings mean net income attributable to ExxonMobil (U.S. GAAP) from the income statement. Unless otherwise indicated, references to earnings, special items, Upstream, Downstream, Chemical and Corporate and Financing segment earnings, and earnings per share are ExxonMobil’s share after excluding amounts attributable to noncontrolling interests.

REVIEW OF SECONDTHIRD QUARTER 2009 RESULTS

Exxon Mobil Corporation reported secondthird quarter 2009 earnings of $3,950$4,730 million, down 6668 percent or $10,100 million from the secondthird quarter of 2008. Earnings per share of $0.81$0.98 were down 6466 percent reflecting lower earnings and the benefit of the share purchase program. The third quarter of 2008 included a special gain of $1,620 million from the sale of a natural gas transportation business in Germany and a special charge of $170 million related to the Valdez punitive damages award. Earnings for the third quarter of 2009 did not include any special items.

Despite ongoing global economic weakness and reduced demand for products, we continued our robust investment program and delivered strong results. We are well-positioned for continued production growth with projects such as QatarGas, RasGas and Gorgon LNG which will contribute additional long plateau production for decades and provide ExxonMobil with a strong foundation.

ExxonMobil’s industry leading financial strength has allowed us to continue to invest across the economic cycle focusing on world class opportunities. Our commitment to a disciplined and long term focused investment strategy sets ExxonMobil apart from its competitors. In addition to funding our capital and operating programs, we distributed $2.0 billion in dividends and purchased $4.0 billion of ExxonMobil common stock during the third quarter, which reduced shares outstanding by 1.2 percent.

-16-


Earnings in the first nine months of 2009 of $13,230 million decreased $24,170 million from 2008. Earnings per share decreased 62 percent to $2.71, reflecting lower earnings and the continued reduction in the number of shares outstanding. Earnings for 2009 included a special charge of $140 million for interest related to the Valdez punitive damages award. Second quarterEarnings for 2008 earnings included a chargespecial gain of $290$1,620 million from the sale of a natural gas transportation business in Germany and special charges of $460 million related to the Valdez punitive damages award.

Global economic conditions continueWhile continuing to impact the energy industry both in the volatility ofbe impacted by lower commodity prices and reduced demand for products. In spite of these challenges, ExxonMobil achieved solid results. We continuedweak product margins, we maintained our capital investment program at near record levels while returning over $16focus on operational excellence and invested $19 billion to our shareholders duringthrough the first halfthree quarters of the year.

year to develop new energy supplies. The Corporation distributed a total of $7.0$22.0 billion to shareholders in the second quarterfirst nine months of 2009 through dividends and share purchases to reduce shares outstanding. Dividends per share of $1.24 increased 8 percent.

 

Earnings in the first half of 2009 of $8,500 million decreased $14,070 million, or 62 percent, from 2008 reflecting lower crude oil and natural gas realizations. Earnings per share decreased 59 percent to $1.73, reflecting lower earnings and the continued reduction in the number of shares outstanding.

-16-


  Second Quarter  First Six Months  Third Quarter  First Nine Months
  2009  2008  2009  2008  2009  2008  2009  2008
  (millions of dollars)  (millions of dollars)

Upstream earnings

                
        

United States

  $813  $2,034  $1,173  $3,665  $709  $1,879  $1,882  $5,544

Non-U.S.

   2,999   7,978   6,142   15,132   3,303   9,092   9,445   24,224
                        

Total

  $3,812  $10,012  $7,315  $18,797  $4,012  $10,971  $11,327  $29,768
                        

Special items included in earnings

        

Non-U.S. Upstream

        

Sale of German gas transportation business

  $0  $1,620  $0  $1,620

Upstream earnings were $3,812of $4,012 million in the secondthird quarter of 2009 were down $6,200$6,959 million from 2008. Lower crude oil and natural gas realizations accounted for the majority of the decline, reducing earnings approximately $6.1 billion.$4.9 billion while higher operating costs reduced earnings approximately $300 million. The third quarter of 2008 included a special gain of $1,620 million from the sale of a natural gas transportation business in Germany.

On an oil-equivalent basis,Oil-equivalent production decreased aboutincreased by 3 percent fromover the secondthird quarter of 2008.2008 with contributions from major start-ups of world-class assets including Qatargas 2, Train 5 and Ras Laffan 3, Train 6 in Qatar. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, production was downup about 2.55 percent.

Liquids production totaled 2,3472,335 kbd (thousands of barrels per day), down 44up 45 kbd from the secondthird quarter of 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, liquids production was flat,up over 5 percent, as field decline was offset by increased production from projects in the United States and west Africa, and lower maintenance activity.Kazakhstan was partly offset by field decline.

SecondThird quarter natural gas production was 8,0138,129 mcfd (millions of cubic feet per day), down 476up 309 mcfd from 2008. New production volumes from project additions in Qatar and the United States and the North Sea were more thanpartly offset by field decline and lower European demand.maintenance in Europe.

Earnings from U.S. Upstream operations were $813$709 million, $1,221$1,170 million lower than the secondthird quarter of 2008. Non-U.S. Upstream earnings were $2,999$3,303 million, down $4,979$5,789 million from last year.

 

 

Upstream earnings were $11,327 million in the first sixnine months of 2009, were $7,315 million, down $11,482$18,441 million from 2008. Lower crude oil and natural gas realizations decreased earnings approximately $11.0$15.8 billion while higher operating costs reduced earnings about $600 million.$1.0 billion. A special gain of $1,620 million from the sale of a natural gas transportation business in Germany was included in 2008.

On an oil-equivalent basis, production decreased less than 2 percent from last year. Excludingwas essentially flat compared to the impacts of entitlement volumes, OPEC quota effects and divestments, production was flat.

Liquids production of 2,411 kbd decreased 19 kbd fromsame period in 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, production was up 1 percent.

Liquids production of 2,385 kbd remained flat with 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, liquids production was up over 12 percent, as new volumes from project additions in west Africa and the United States, and lower maintenance activity, were partly offset by field decline.

Natural gas production of 9,0948,778 mcfd decreased 26564 mcfd from 2008. Higher volumes from Qatar and North Sea projects were more than offset by field decline and lower European demand.decline.

Earnings from U.S. Upstream operations for 2009 were $1,173$1,882 million, a decrease of $2,492$3,662 million. Earnings outside the U.S. were $6,142$9,445 million, $8,990 million lower than last year.down $14,779 million.

 

-17-


  Second Quarter  First Six Months  Third Quarter  First Nine Months
  2009 2008  2009  2008  2009 2008  2009  2008
  (millions of dollars)  (millions of dollars)

Downstream earnings

              

United States

  $(15 $293  $337  $691  $(203 $978  $134  $1,669

Non-U.S.

   527    1,265   1,308   2,033   528    2,035   1,836   4,068
                        

Total

  $512   $1,558  $1,645  $2,724  $325   $3,013  $1,970  $5,737
                        

Downstream earnings of $512$325 million in the secondthird quarter of 2009 were down $1,046$2,688 million from the third quarter of 2008. Lower refining margins drove the decline, reducing earnings approximately $1.0 billion, as weaker refining margins more than offset stronger marketing margins.$2.6 billion. Petroleum product sales of 6,4876,301 kbd were 288387 kbd lower than last year’s secondthird quarter, mainly reflecting asset sales and lower demand.

The U.S. Downstream recorded a loss of $15$203 million, down $308$1,181 million from the secondthird quarter of 2008. Non-U.S. Downstream earnings of $527$528 million were $738$1,507 million lower than last year.

 

 

Downstream earnings of $1,970 million in the first sixnine months of 2009 of $1,645 million were $1,079$3,767 million lower than 2008. Weaker margins reduceddecreased earnings approximately $300 million.$2.8 billion. Lower volumes and refinery optimization associated withdue to weaker demand reduced earnings about $500 million. Highermillion while higher operating costs mainly associated with planned work activity also reducedresulted in a $300 million decline in earnings. Petroleum product sales of 6,4616,407 kbd decreased from 6,7986,761 kbd in 2008, mainly reflecting asset sales and lower demand.

U.S. Downstream earnings were $337$134 million, down $354$1,535 million. Non-U.S. Downstream earnings were $1,308$1,836 million, $725$2,232 million lower than last year.

 

  Second Quarter  First Six Months  Third Quarter  First Nine Months
  2009  2008  2009  2008  2009  2008  2009  2008
  (millions of dollars)  (millions of dollars)

Chemical earnings

                

United States

  $79  $102  $162  $386  $315  $257  $477  $643

Non-U.S.

   288   585   555   1,329   561   830   1,116   2,159
                        

Total

  $367  $687  $717  $1,715  $876  $1,087  $1,593  $2,802
                        

Chemical earnings of $367$876 million in the secondthird quarter of 2009 were $320$211 million lower than the third quarter of 2008. Lower volumes reducedWeaker margins drove the decline, reducing earnings approximately $150 million, while weaker margins decreased earnings by about $100$170 million. Hurricane repair costs and unfavorable foreign exchange effects also reduced earnings. SecondThird quarter prime product sales of 6,2676,356 kt (thousands of metric tons) were 451296 kt lowerhigher than the prior year primarily due to weaker demand.the absence of last year’s hurricane impacts.

 

 

Chemical earnings of $1,593 million in the first sixnine months of 2009 of $717 million decreased $998$1,209 million from 2008. Lower volumesWeaker margins reduced earnings by approximately $450$500 million while lower marginsvolumes reduced earnings about $350$400 million. Unfavorable foreign exchange effects and hurricane costs also decreased earnings.earnings by $200 million. Prime product sales of 11,79418,150 kt were down 1,5021,206 kt from 2008.

 

-18-


  Second Quarter First Six Months   Third Quarter First Nine Months 
  2009 2008 2009 2008   2009 2008 2009 2008 
  (millions of dollars)   (millions of dollars) 

Corporate and financing earnings

  $(741 $(577 $(1,177 $(666  $(483 $(241 $(1,660 $(907

Special items included in earnings

          

Corporate and financing

          

Valdez litigation

  $(140 $(290 $(140 $(290  $0   $(170 $(140 $(460

Corporate and financing expenses of $741$483 million in the secondthird quarter of 2009 were up $164$242 million from 2008, due mainly to lower interest income partially offset by a lowerthe absence of the Valdez litigationinterest charge in the current period.2008.

 

 

Corporate and financing expenses in the first sixnine months of 2009 of $1,177$1,660 million were up $511$753 million from 2008, mainly due to lower interest income partially offset by a lower Valdez litigation charge in the current year.

LIQUIDITY AND CAPITAL RESOURCES

 

  Second Quarter  First Six Months   Third Quarter  First Nine Months 
  2009  2008  2009 2008   2009  2008  2009 2008 
  (millions of dollars)   (millions of dollars) 

Net cash provided by/(used in)

              

Operating activities

      $11,107   $34,838        $19,934   $49,241  

Investing activities

       (9,713  (8,768       (15,997  (12,872

Financing activities

       (17,360  (22,204       (23,388  (32,624

Effect of exchange rate changes

       105    1,121         486    (1,052
                      

Increase/(decrease) in cash and cash equivalents

      $(15,861 $4,987        $(18,965 $2,693  
                      

Cash and cash equivalents (at end of period)

      $15,576   $38,968        $12,472   $36,674  

Cash flow from operations and asset sales

              

Net cash provided by operating activities (U.S. GAAP)

  $2,197  $13,418  $11,107   $34,838    $8,827  $14,403  $19,934   $49,241  

Sales of subsidiaries, investments and property, plant and equipment

   770   1,159   911    1,572     172   2,630   1,083    4,202  
                          

Cash flow from operations and asset sales

  $2,967  $14,577  $12,018   $36,410    $8,999  $17,033  $21,017   $53,443  
                          

Because of the ongoing nature of our asset management and divestment program, we believe it is useful for investors to consider asset sales proceeds together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities.

Total cash and cash equivalents of $15.6$12.5 billion at the end of the secondthird quarter of 2009 compared to $39.0$36.7 billion at the end of the secondthird quarter of 2008.

Cash provided by operating activities totaled $11,107$19,934 million for the first sixnine months of 2009, $23,731$29,307 million lower than 2008. The major source of funds was net income including noncontrolling interests of $8,648$13,519 million, adjusted for the noncash provision of $5,797$8,724 million for depreciation and depletion, both of which decreased. In the 2008 period, the effects of higher prices on payments of accounts and other payables and collection of accounts receivable and the timing of income tax payments added to cash provided by operating activities. All other items net in 2009 included $3.9$4.1 billion of pension fund contributions, consistent with previous disclosures. For additional details, see the Condensed Consolidated Statement of Cash Flows on page 5.

Investing activities for the first sixnine months of 2009 used net cash of $9,713$15,997 million compared to $8,768$12,872 million in the prior year. Spending for additions to property, plant and equipment increased $1,387$1,735 million to $10,238$15,728 million. Proceeds from asset divestments of $911$1,083 million in 2009 were lower.lower, mainly attributable to the absence of the sale of the German natural gas transportation business in 2008. Sales of investments in marketable securities in the current period, compared to purchases in 2008, are reflected in the change in other investing activities.

 

-19-


Cash flow from operations and asset sales in the secondthird quarter of 2009 of $3.0$9.0 billion, including asset sales of $0.8$0.2 billion, decreased $11.6$8.0 billion from the comparable 2008 period. Cash flow from operations and asset sales in the first sixnine months of 2009 of $12.0$21.0 billion, including asset sales of $0.9$1.1 billion, decreased $24.4$32.4 billion from 2008.

Net cash used in financing activities of $17,360$23,388 million in the first sixnine months of 2009 was $4,844$9,236 million lower reflecting a lower level of purchases of shares of ExxonMobil stock.

During the secondthird quarter of 2009, Exxon Mobil Corporation purchased 7561 million shares of its common stock for the treasury at a gross cost of $5.2$4.2 billion. These purchases included $5.0$4.0 billion to reduce the number of shares outstanding, with the balance used to offset shares issued in conjunction with the company’s benefit plans and programs. Shares outstanding were reduced from 4,880 million at the end of the first quarter to 4,806 million at the end of the second quarter. Share purchasesquarter to reduce shares outstanding are currently anticipated to equal $4.0 billion in4,747 million at the end of the third quarter of 2009.quarter.

Gross share purchases through the first halfnine months of 2009 were $13.1$17.3 billion, reducing shares outstanding by 3.44.6 percent. Purchases may be made in both the open market and through negotiated transactions, and may be increased, decreased or discontinued at any time without prior notice.

The Corporation distributed to shareholders a total of $7.0$6.0 billion in the secondthird quarter of 2009 and $16.0$22.0 billion in the first halfnine months of 2009 through dividends and share purchases to reduce shares outstanding.

Total debt of $9.3$9.6 billion at JuneSeptember 30, 2009, compared to $9.4 billion at year-end 2008. The Corporation’s debt to total capital ratio was 7.77.9 percent at the end of the secondthird quarter of 2009 compared to 7.4 percent at year-end 2008.

Although the Corporation issues long-term debt from time to time and maintains a revolving commercial paper program, internally generated funds are expected to cover the majority of its near-term financial requirements.

The Corporation, as part of its ongoing asset management program, continues to evaluate its mix of assets for potential upgrade. Because of the ongoing nature of this program, dispositions will continue to be made from time to time which will result in either gains or losses.

In accordance with a nationalization decree issued by Venezuela’s president in February 2007, by May 1, 2007, a subsidiary of the Venezuelan National Oil Company (PdVSA) assumed the operatorship of the Cerro Negro Heavy Oil Project. This Project had been operated and owned by ExxonMobil affiliates holding a 41.67 percent ownership interest in the Project. The decree also required conversion of the Cerro Negro Project into a “mixed enterprise” and an increase in PdVSA’s or one of its affiliate’s ownership interest in the Project, with the stipulation that if ExxonMobil refused to accept the terms for the formation of the mixed enterprise within a specified period of time, the government would “directly assume the activities” carried out by the joint venture. ExxonMobil refused to accede to the terms proffered by the government, and on June 27, 2007, the government expropriated ExxonMobil’s 41.67 percent interest in the Cerro Negro Project.

On September 6, 2007, affiliates of ExxonMobil filed a Request for Arbitration with the International Centre for Settlement of Investment Disputes. An affiliate of ExxonMobil has also filed an arbitration under the rules of the International Chamber of Commerce against PdVSA and a PdVSA affiliate for breach of their contractual obligations under certain Cerro Negro Project agreements. At this time, the net impact of this matter on the Corporation’s consolidated financial results cannot be reasonably estimated. However, the Corporation does not expect the resolution to have a material effect upon the Corporation’s operations or financial condition. ExxonMobil’s remaining net book investment in Cerro Negro producing assets is about $750 million.

 

-20-


TAXES

 

  Second Quarter First Six Months   Third Quarter First Nine Months 
  2009 2008 2009 2008   2009 2008 2009 2008 
  (millions of dollars)   (millions of dollars) 

Income taxes

  $3,571   $10,526   $6,719   $19,828    $4,333   $11,327   $11,052   $31,155  

Effective income tax rate

   50  49  47  48   50  44  48  47

Sales-based taxes

   6,216    9,538    12,122    17,970     6,805    9,327    18,927    27,297  

All other taxes and duties

   9,124    12,297    17,713    23,904     9,729    11,856    27,442    35,760  
                          

Total

  $18,911   $32,361   $36,554   $61,702    $20,867   $32,510   $57,421   $94,212  
                          

Income, sales-based and all other taxes and duties for the secondthird quarter of 2009 of $18,911$20,867 million were lower than 2008. In the secondthird quarter of 2009 income tax expense declined to $3,571$4,333 million reflecting the lower level of earnings and the effective income tax rate was 50 percent, compared to $10,526$11,327 million and 4944 percent, respectively, in the prior year period. Sales-based taxes and all other taxes and duties decreased in 2009 reflecting lower prices and foreign exchange effects.

 

 

Income, sales-based and all other taxes and duties for the first sixnine months of 2009 of $36,554$57,421 million were lower than 2008. In the first sixnine months of 2009 income tax expense declined to $6,719$11,052 million reflecting the lower level of earnings and the effective income tax rate was 4748 percent, compared to $19,828$31,155 million and 4847 percent, respectively, in the prior year period. Sales-based taxes and all other taxes and duties decreased in 2009 reflecting lower prices and foreign exchange effects.

CAPITAL AND EXPLORATION EXPENDITURES

 

  Second Quarter  First Six Months  Third Quarter  First Nine Months
  2009  2008  2009  2008  2009  2008  2009  2008
  (millions of dollars)  (millions of dollars)

Upstream (including exploration expenses)

  $4,905  $5,257  $9,271  $9,352  $4,907  $5,277  $14,178  $14,629

Downstream

   817   904   1,463   1,731   831   844   2,294   2,575

Chemical

   830   797   1,588   1,363   747   721   2,335   2,084

Other

   10   12   14   15   8   11   22   26
                        

Total

  $6,562  $6,970  $12,336  $12,461  $6,493  $6,853  $18,829  $19,314
                        

ExxonMobil continued its robust capital investment program in the second quarter. Capital and exploration project spending was $6.6expenditures were $6.5 billion in the secondthird quarter of 2009, down 65 percent from last year, mainly due to2008, reflecting the strengtheningimpacts of thea stronger U.S. dollar.

 

 

In line with our longer term plan, capitalCapital and exploration expenditures forwere $18.8 billion in the first halfnine months of 2009, were $12.3 billion, down 13 percent versus 2008 due to the stronger U.S. dollar. Capital and exploration expenditures for full year 2008 were $26.1 billion and are expected to range from $25 billion to $30 billion for the next several years. Actual spending could vary depending on the progress of individual projects.

FORWARD-LOOKING STATEMENTS

Statements in this report relating to future plans, projections, events or conditions are forward-looking statements. Actual results, including project plans, costs, timing, and capacities; capital and exploration expenditures; and share purchase levels, could differ materially due to factors including: changes in long-term oil or gas prices or other market or economic conditions affecting the oil and gas industry; completion of repair projects as planned; unforeseen technical difficulties; political events or disturbances; reservoir performance; the outcome of commercial negotiations; wars and acts of terrorism or sabotage; changes in technical or operating conditions; and other factors discussed under the heading “Factors Affecting Future Results” on our website and in Item 1A of ExxonMobil’s 2008 Form 10-K. We assume no duty to update these statements as of any future date.

 

-21-


Item 3.Quantitative and Qualitative Disclosures About Market Risk

Information about market risks for the sixnine months ended JuneSeptember 30, 2009, does not differ materially from that discussed under Item 7A of the registrant’s Annual Report on Form 10-K for 2008.

 

Item 4.Controls and Procedures

As indicated in the certifications in Exhibit 31 of this report, the Corporation’s chief executive officer, principal financial officer and principal accounting officer have evaluated the Corporation’s disclosure controls and procedures as of JuneSeptember 30, 2009. Based on that evaluation, these officers have concluded that the Corporation’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by the Corporation in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to them in a manner that allows for timely decisions regarding required disclosures and are effective in ensuring that such information is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. There were no changes during the Corporation’s last fiscal quarter that materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

PART II. OTHER INFORMATION

 

Item 1.Legal Proceedings

The Corporation reported in November 2008 certain incidents of acid gas flaring at its refinery in Baytown, Texas pursuant to the Corporation’s 2005 consent decree with the U.S. Environmental Protection Agency (“EPA”) et al., entered by the U.S. District Court for the Northern District of Illinois, relating to the EPA’s New Source Review Enforcement Initiative. The Corporation reported these incidents as covered by the force majeure provisions of the Consent Decree, but the EPA responded on September 30, 2009, with a demand for stipulated penalties pursuant to the Consent Decree of $385,000. The Corporation is preparing a response to the penalty demand.

The Louisiana Department of Environmental Quality (LDEQ) issued a Consolidated Compliance Order & Notice of Potential Penalty to the Corporation’s Baton Rouge, Louisiana refinery on March 7, 2008, relating to alleged noncompliance with leak detection and repair (LDAR) requirements for fugitive emission components in certain refinery equipment. The refinery self-disclosed these issues to the LDEQ and continues to conduct leak detection and monitoring activities pursuant to its LDAR plan. Although the LDEQ will not propose a specific penalty until the refinery completes its corrective action steps, it is believed at this time that the potential penalty could exceed $100,000.

Regarding a previouslymatter reported matter,in the Corporation’s second quarter 2009 Form 10-Q, between the dates of June 16 and June 23, 2009, single-count criminal informations alleging violations of 16 U.S.C. Sections 703 and 707 of the Migratory Bird Treaty Act were filed by the U.S. government against Exxon Mobil Corporation in the Federal DistrictsU.S. District Courts of Colorado, Kansas, and Wyoming, and in the Western District of Oklahoma and the Northern District of Texas. These informations are beingwere consolidated for resolution in the FederalU.S. District Court of Colorado. AThe U.S. Government and the company entered into a plea agreement intended to resolve the consolidated matter, has been signedwhich was approved by the U.S. government andcourt on August 12, 2009. Under the company. The plea agreement, requires that Exxon Mobil Corporation pleadpled guilty to the five individual informations alleging misdemeanor violations of 16 U.S.C. Section 703 and 707(a) of the Migratory Bird Treaty Act and agreeagreed to the following: (1) a term of probation of three years; (2) to fund and implement an environmental compliance plan for the three year probationary period; (3) to pay an aggregate fine of $400,000 directed to the North American Wetlands Conservation Fund ($80,000 per jurisdiction for wetlands conservation work in each jurisdiction); (4) to pay a special assessment of $250; and (5) to pay $200,000 in community service payments ($40,000 in Colorado to the Pauline S. Schnegas Foundation and $40,000 for each remaining jurisdiction to the National Fish and Wildlife Foundation). A hearing before the court to review the plea agreement is scheduled for August 12, 2009.

The Massachusetts Department of Environmental Protection (MADEP) and State Attorney General (AG) have alleged that between 2000 and 2008 the Everett and Springfield terminals in Massachusetts violated a number of their air permit requirements and provisions of Clean Air Act regulations. By letter dated April 17, 2009, the AG itemized the violations and made a settlement demand upon the company that would require specific physical changes at both facilities to reduce air emissions as well as a payment of a civil penalty of $8.1 million. ExxonMobil has responded to the demand letter, outlining certain arguments and defenses and a meeting is scheduled for September 2009 to discuss the issues. The MADEP and AG have stated that if the parties are unsuccessful in reaching a settlement that they will file a civil complaint with the Massachusetts Superior Court seeking injunctive relief and a monetary penalty.

Regarding a previously reported matter, on December 23, 2008, the office of the United States Attorney for the District of Massachusetts filed a misdemeanor criminal information alleging that ExxonMobil Pipeline Company violated 33 U.S.C. Sections 1319(c) (1) and 1321(b) (3) of the Clean Water Act resulting from a spill that occurred on or about January 9-10, 2006, on the Island End River near the Corporation’s Everett Terminal facility in Everett, Massachusetts. A plea agreement intended to resolve the case was also filed with the Federal District Court on that same date. On April 30, 2009, the court accepted and approved a revised plea agreement as the basis for the resolution of the matter. The revised plea agreement requires that ExxonMobil Pipeline Company plead guilty to a misdemeanor violation of 33 U.S.C. Section 1319(c)(1) of the Clean Water Act and agree to the following: (1) a term of probation of three years; (2) fund and implement an environmental compliance plan for the three year probationary period; (3) pay a fine of $359,018 and a special assessment of $125; (4) pay $4,640,982 in community service payments to the North American Wetlands Conservation Act Fund and $1,000,000 to the Massachusetts Environmental Trust; and (5) pay $179,509 for spill-related cleanup costs.

 

-22-


In September 2009, purported shareholder derivative petitions captionedDragoone v. Boskin, et al. andTropiano v. Boskin, et al.were filed in the District Court of Dallas County, Texas, naming certain current and former directors as defendants and ExxonMobil as a nominal defendant. The Louisiana Departmentpetitions claim that the individual defendants breached their fiduciary duties by, among other things, allegedly failing to properly supervise the management of Environmental Quality (LDEQ) issuedland leases overlaying hydrocarbon resources in the Point Thomson Unit on the Northern Slope of Alaska. The petitions also allege that the individual defendants caused the company to make materially false and misleading statements concerning the leases and caused the waste of corporate assets. The petitions seek damages from the individual defendants in favor of ExxonMobil, equitable relief to remedy their alleged breaches, and costs and expenses of the action.

In October 2009, a Consolidated Compliance Order & Noticepurported shareholder complaint captionedResnik v. Boskin et al.,alleging direct and derivative claims, was filed in the United States District Court for the District of Potential PenaltyNew Jersey, naming the present directors, the “named executive officers” (as defined in SEC regulations) and ExxonMobil as defendants. The complaint alleges that ExxonMobil made materially false and misleading statements and omissions concerning the tax deductibility of certain incentive compensation paid to the Corporation’s Baton Rouge Resins Finishing Plant (BRFP) on October 16, 2008, relatingnamed executive officers under ExxonMobil’s 2003 Incentive Program. The complaint seeks the distribution to alleged exceedencesstockholders of air permit limits for certain volatile organic compounds and hazardous air pollutants. BRFP has self-disclosed these emission resultscorrective disclosure, stockholder reapproval of the program, an injunction against payments under the program to the LDEQnamed executive officers, damages from the individual defendants in favor of ExxonMobil, and proposed a numbercosts and expenses of specific corrective action steps. Although LDEQ will not propose a specific penalty until BRFP completes its corrective action steps, it is believed at this time that the potential penalty could exceed $100,000. Completion of all action steps is required by October 2010.action.

Refer to the relevant portions of note 3 on pages 6 and 7 of this Quarterly Report on Form 10-Q for further information on legal proceedings.

 

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchase of Equity Securities for Quarter Ended JuneSeptember 30, 2009

 

 

Period

  Total Number
Of Shares
Purchased
  Average
Price Paid
per Share
  Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
  Maximum Number
Of Shares that May
Yet Be Purchased
Under the Plans or
Programs
 

April, 2009

  25,761,081  $67.65  25,761,081  

May, 2009

  24,107,846  $69.26  24,107,846  

June, 2009

  25,624,412  $71.55  25,624,412  
          

Total

  75,493,339  $69.49  75,493,339  (See Note 1
            

Period

  Total Number
Of Shares
Purchased
  Average
Price Paid
per Share
  Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
  Maximum Number
Of Shares that May
Yet Be Purchased
Under the Plans or
Programs
 

July, 2009

  21,935,315  $68.78  21,935,315  

August, 2009

  19,623,432  $69.36  19,623,432  

September, 2009

  19,598,447  $69.54  19,598,447  
          

Total

  61,157,194  $69.21  61,157,194  (See Note 1
            

 

Note 1 — On August 1, 2000, the Corporation announced its intention to resume purchases of shares of its common stock for the treasury both to offset shares issued in conjunction with company benefit plans and programs and to gradually reduce the number of shares outstanding. The announcement did not specify an amount or expiration date. The Corporation has continued to purchase shares since this announcement and to report purchased volumes in its quarterly earnings releases. In its most recent earnings release dated July 30,October 29, 2009, the Corporation stated that share purchases to reduce shares outstanding are anticipated to equal $4.0$2.0 billion in the thirdfourth quarter of 2009. Purchases may be made in both the open market and through negotiated transactions, and purchases may be increased, decreased or discontinued at any time without prior notice.

 

-23-


Item 4.Submission of Matters to a Vote of Security Holders

At the annual meeting of shareholders on May 27, 2009, the following proposals were voted upon. Percentages are based on the total of the shares voted For and either Withheld or voted Against, as appropriate.

Concerning Election of Directors

     
  Votes   Votes

Nominees

  Cast For     Withheld

Michael J. Boskin

  3,951,659,061  97.7 93,449,181

Larry R. Faulkner

  3,985,296,125  98.5 59,812,117

Kenneth C. Frazier

  3,985,850,409  98.5 59,257,833

William W. George

  3,957,521,571  97.8 87,586,671

Reatha Clark King

  3,950,087,701  97.7 95,020,541

Marilyn Carlson Nelson

  3,855,775,072  95.3 189,333,170

Samuel J. Palmisano

  3,852,649,642  95.2 192,458,600

Steven S Reinemund

  3,992,214,101  98.7 52,894,141

Rex W. Tillerson

  3,950,153,462  97.7 94,954,780

Edward E. Whitacre, Jr.

  3,957,608,323  97.8 87,499,919

Concerning Ratification of Independent Auditors

     

Votes Cast For:

  3,965,445,393  98.5 

Votes Cast Against:

  60,490,317  1.5 

Abstentions:

  19,172,532   

Broker Non-Votes:

  0   

Concerning Cumulative Voting

     

Votes Cast For:

  900,649,054  28.6 

Votes Cast Against:

  2,245,257,131  71.4 

Abstentions:

  35,085,402   

Broker Non-Votes:

  864,116,655   

Concerning Special Shareholder Meetings

     

Votes Cast For:

  1,281,883,860  40.8 

Votes Cast Against:

  1,863,349,449  59.2 

Abstentions:

  35,758,278   

Broker Non-Votes:

  864,116,655   

Concerning Incorporate in North Dakota

     

Votes Cast For:

  151,516,352  4.8 

Votes Cast Against:

  2,980,823,489  95.2 

Abstentions:

  48,651,746   

Broker Non-Votes:

  864,116,655   

Concerning Board Chairman and CEO

     

Votes Cast For:

  916,466,207  29.5 

Votes Cast Against:

  2,190,632,259  70.5 

Abstentions:

  73,893,121   

Broker Non-Votes:

  864,116,655   

Concerning Shareholder Advisory Vote on Executive Compensation

  

 

Votes Cast For:

  1,276,583,944  41.4 

Votes Cast Against:

  1,805,434,160  58.6 

Abstentions:

  98,973,483   

Broker Non-Votes:

  864,116,655   

Concerning Executive Compensation Report

  

 

Votes Cast For:

  361,158,523  11.6 

Votes Cast Against:

  2,740,567,725  88.4 

Abstentions:

  79,265,339   

Broker Non-Votes:

  864,116,655   

-24-


Concerning Corporate Sponsorships Report

     

Votes Cast For:

  215,789,475  7.9 

Votes Cast Against:

  2,525,796,026  92.1 

Abstentions:

  439,406,086   

Broker Non-Votes:

  864,116,655   

Concerning Amendment of EEO Policy

     

Votes Cast For:

  1,186,969,116  39.3 

Votes Cast Against:

  1,830,853,358  60.7 

Abstentions:

  163,169,113   

Broker Non-Votes:

  864,116,655   

Concerning Greenhouse Gas Emissions Goals

     

Votes Cast For:

  797,275,710  29.0 

Votes Cast Against:

  1,951,943,111  71.0 

Abstentions:

  431,772,766   

Broker Non-Votes:

  864,116,655   

Concerning Climate Change and Technology Report

     

Votes Cast For:

  274,740,079  10.0 

Votes Cast Against:

  2,478,475,827  90.0 

Abstentions:

  427,775,681   

Broker Non-Votes:

  864,116,655   

Concerning Renewable Energy Policy

     

Votes Cast For:

  743,884,565  27.3 

Votes Cast Against:

  1,984,340,842  72.7 

Abstentions:

  452,766,180   

Broker Non-Votes:

  864,116,655   

For additional information, see the registrant’s definitive proxy statement dated April 13, 2009, “Item 1 - Election of Directors” (beginning on page 13) and the items beginning with “Item 2 - Ratification of Independent Auditors”, on page 50, through “Item 13 - Renewable Energy Policy”, ending on page 68.

Item 6.Exhibits

 

Exhibit

  

Description

10(iii)(f.4)Standing resolution for non-employee director cash fees dated October 28, 2009 (incorporated by reference to Exhibit 99.1 to the Registrant’s Report on Form 8-K on October 28, 2009).
31.1  Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Chief Executive Officer.
31.2  Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Financial Officer.
31.3  Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Accounting Officer.
32.1  Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer.
32.2  Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Financial Officer.
32.3  Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Accounting Officer.
101  Interactive Data Files.

 

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EXXON MOBIL CORPORATION

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  EXXON MOBIL CORPORATION
Date: AugustNovember 5, 2009   
  By: 

/s/ Patrick T. Mulva

  Name: Patrick T. Mulva
  Title: Vice President, Controller and Principal
Accounting Officer

 

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INDEX TO EXHIBITS

 

Exhibit

  

Description

10(iii)(f.4)Standing resolution for non-employee director cash fees dated October 28, 2009 (incorporated by reference to Exhibit 99.1 to the Registrant’s Report on Form 8-K on October 28, 2009).
31.1  Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Chief Executive Officer.
31.2  Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Financial Officer.
31.3  Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Accounting Officer.
32.1  Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer.
32.2  Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Financial Officer.
32.3  Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Accounting Officer.
101  Interactive Data Files.

 

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