• Third quarter results improved by $400 million from the second quarter, primarily driven by early stages of demand recovery; excluding identified items, results improved by $2.2 billion
• On track to exceed reduction targets for 2020 capital and cash expenses; further reductions anticipated in 2021
• Continued Guyana progress with third major deepwater development approval and two new discoveries

Exxon Mobil Corporation has announced an estimated third quarter 2020 loss of $680 million, or $0.15 per share assuming dilution. Third quarter capital and exploration expenditures were $4.1 billion, bringing year-to-date spending to $16.6 billion, more than $6 billion lower than the prior year period.

Oil-equivalent production was 3.7 million barrels per day, up 1 percent from the second quarter of 2020. Production continued to reflect COVID-19 demand impacts, including economic and government mandated curtailments. Excluding entitlement effects, divestments, and government mandates, liquids production increased 2 percent, while natural gas volumes decreased 1 percent.

“We remain confident in our long-term strategy and the fundamentals of our business, and are taking the necessary actions to preserve value while protecting the balance sheet and dividend,” said Darren W. Woods, chairman and chief executive officer. “We are on pace to achieve our 2020 cost-reduction targets and are progressing additional savings next year as we manage through this unprecedented down cycle.”

The company’s preliminary 2021 capital program, which will be reviewed by the board of directors in the fourth quarter, is expected to be in the range of $16 billion to $19 billion, a reduction from the 2020 target of $23 billion announced in April. The company expects to identify further structural efficiencies as it continues previously announced country-by-country reviews.

Upstream

• Average third quarter realizations for crude oil improved significantly, as market prices increased following the second quarter's challenging environment. Natural gas realizations declined, primarily due to a lag in crude-linked LNG contract pricing.
• Improved market conditions enabled full recovery of production impacted by economic curtailments. Government mandated curtailments negatively impacted third quarter results and are anticipated to continue in the fourth quarter.

Downstream

• Supply chain optimization, higher product sales due to increased demand, and higher marketing margins more than offset lower industry fuels margins driven by market oversupply and high product inventory levels.
• Third quarter saw the best reliability and process performance in the last 10 years, while average refinery utilization increased about 6 percent from the second quarter on demand recovery. Refining capacity sparing decreased to about 25 percent.

Chemical

• Chemical sales volumes were higher than second quarter, benefiting from resilient packaging demand and recovering automotive and construction markets. Chemical margins were negatively impacted by higher feed costs.
• The company's Corpus Christi chemical complex joint venture is approximately 80 percent complete, with start-up activities expected to commence in the fourth quarter of 2021.

Cost Management

ExxonMobil made significant progress during the quarter on previously announced capital and cash operating expense reductions. Planned reductions to the 2020 capital spending program, from $33 billion to $23 billion, are ahead of schedule, reflecting increased efficiencies, lower market prices, and slower project pace. An expected decrease in cash operating expenses of about 15 percent is also ahead of schedule, capturing savings from increased efficiencies, reduced activity, and lower energy costs and volumes.

The company plan to reduce staffing levels in the United States, primarily at its management offices in Houston, Texas, anticipating around 1,900 employees will be affected through voluntary and involuntary programs.

KeyFacts Energy: ExxonMobil US country profile