Exxon 2015 Annual Report Download - page 4

ExxonMobil creates shareholder value by providing industry leadership to meet one of the world’s greatest challenges –
supplying the energy needed to advance global economic prosperity in a safe, secure, and environmentally responsible way.
The oil and gas business is cyclical, driven by the supply-and-demand balance. Technological innovations and significant
investments have unlocked an abundance of energy supply, including North America’s unconventional resources. At the same
time, global economic growth has slowed, leading to a market that is oversupplied, resulting in today’s lower energy prices.
Yet, even in the midst of these short-term challenges, we maintain a longer-term view for our strategic decisions and
business plans, underpinned by our Outlook for Energy, an annual assessment that is shared publicly. A rising world
population and burgeoning middle class, along with anticipated economic progress, will drive 25-percent growth in energy
demand from 2014 to 2040. Fueling this global expansion will require substantial new sources of energy across all resource
types along with further advances in technology and continued capture of ever-improving energy efficiency. By improving
access to reliable and affordable energy, we can help reduce poverty and advance living standards for billions of people.
Therefore, ExxonMobil continues to innovate and selectively invest through the cycle to supply these long-term growth
markets and create value for our shareholders.
Our longer-term view also helps us meet another important aspect of the energy challenge: doing our part to minimize
impacts to the environment. ExxonMobil views climate change as a serious risk. As with every aspect of our business,
we approach these risks with the highest level of integrity and thoughtful action. ExxonMobil has studied climate change
for almost 40 years. We were among the first to seriously
study the possibility of links between the use of fossil
fuels and impacts to the environment, and we have and
continue to collaborate and share our research with
leading scientific institutions, both governmental and
nongovernmental; top universities; the United Nations;
and other public stakeholders.
ExxonMobil continues to support advanced research to progress climate science and develop breakthrough technologies
as well as participate in constructive dialogue on policy options with nongovernmental organizations, industry, and
policymakers. In our operations, we remain focused on increasing energy efficiency and minimizing flaring, venting,
and fugitive emissions, and we are implementing reduction technologies, such as cogeneration and carbon sequestration.
Products we produce, such as cleaner-burning natural gas, also help to reduce global emissions.
Our 2015 results demonstrate the capabilities of our world-class workforce and the resilience of our integrated businesses.
We achieved strong safety and environmental performance, reflecting an unwavering commitment to operational
excellence and effective risk management. Despite a volatile and challenging energy landscape, we delivered solid financial
results, highlighted by earnings of $16.2 billion and a return on capital employed that, while reflecting bottom-of-cycle
conditions, nonetheless consistently leads competition.
The scale and integrated nature of our cash flows along with diligent cash management provide unparalleled financial
strength, allowing us to confidently and prudently invest through the business cycle while paying a reliable and growing
dividend to our shareholders. Capital and exploration expenditures were $31.1 billion, $7.4 billion below 2014, reflecting cost
savings in a rapidly changing market, capital efficiencies, and timely completion of several major projects. By continuing our
disciplined investment programs at levels appropriate to the current environment, we capture significant savings and position
our assets for better financial performance. Shareholder distributions were $15.1 billion, in the form of dividends and share
purchases to reduce shares outstanding, and included a 5.8-percent increase in quarterly dividends per share. This marked
the 33rd consecutive year ExxonMobil has increased the dividend, further differentiating ourselves from competitors.
Our Upstream business continues to demonstrate exceptional project development capabilities. Production volumes of
4.1 million oil-equivalent barrels per day were up 3 percent from 2014, reflecting investments in new development growth.
We started up six major projects in 2015, adding nearly 300 thousand barrels per day of working interest production
capacity. These include two capital-efficient subsea tiebacks offshore West Africa – Kizomba Satellites Phase 2 in Angola
and Erha North Phase 2 in Nigeria – as well as an expansion of the Kearl oil sands development in Canada. These projects
started up ahead of schedule and on or below budget.
To Our Shareholders
ExxonMobil is uniquely suited to compete
effectively throughout the cycle, and our strong
balance sheet positions us to pursue new
opportunities in today’s challenging market.