EXXON MOBIL CORP - Quarter Report: 2019 September (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019

☐ 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		(I.R.S. Employer
incorporation or organization)		Identification Number)

5959 Las Colinas Boulevard, Irving, Texas 75039-2298

(Address of principal executive offices) (Zip Code)

(972) 940-6000

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

		Name of Each Exchange
Title of Each Class	Trading Symbol	on Which Registered
Common Stock, without par value	XOM	New York Stock Exchange

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 ☑No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑No ☐

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

Large accelerated filer	☑	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

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 September 30, 2019
Common stock, without par value		4,231,106,066

EXXON MOBIL CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2019

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

Item 1.Financial Statements

Condensed Consolidated Statement of Income Three and nine months ended September 30, 2019 and 2018	3

Condensed Consolidated Statement of Comprehensive Income Three and nine months ended September 30, 2019 and 2018	4

Condensed Consolidated Balance Sheet As of September 30, 2019 and December 31, 2018	5

Condensed Consolidated Statement of Cash Flows Nine months ended September 30, 2019 and 2018	6

Condensed Consolidated Statement of Changes in Equity Three months ended September 30, 2019 and 2018	7

Condensed Consolidated Statement of Changes in Equity Nine months ended September 30, 2019 and 2018	8

Notes to Condensed Consolidated Financial Statements	9

Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.Quantitative and Qualitative Disclosures About Market Risk	28

Item 4.Controls and Procedures	28


PART II. OTHER INFORMATION
Item 1.Legal Proceedings	29

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds	30

Item 6.Exhibits	30

Index to Exhibits	31

Signature	32

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(millions of dollars)

			Three Months Ended		Nine Months Ended
			September 30,		September 30,
			2019	2018	2019	2018
Revenues and other income
	Sales and other operating revenue		63,422	74,187	192,559	211,079
	Income from equity affiliates		1,196	1,960	4,264	5,599
	Other income		431	458	942	1,639
		Total revenues and other income	65,049	76,605	197,765	218,317
Costs and other deductions
	Crude oil and product purchases		35,290	41,776	109,033	119,391
	Production and manufacturing expenses		8,848	9,097	27,340	26,506
	Selling, general and administrative expenses		2,753	2,892	8,350	8,632
	Depreciation and depletion		4,873	4,658	14,075	13,717
	Exploration expenses, including dry holes		299	292	912	911
	Non-service pension and postretirement benefit expense		357	307	1,028	952
	Interest expense		232	200	629	551
	Other taxes and duties		7,676	8,303	22,756	24,825
		Total costs and other deductions	60,328	67,525	184,123	195,485
Income before income taxes			4,721	9,080	13,642	22,832
	Income taxes		1,474	2,634	4,598	7,617
Net income including noncontrolling interests			3,247	6,446	9,044	15,215
	Net income attributable to noncontrolling interests		77	206	394	375
Net income attributable to ExxonMobil			3,170	6,240	8,650	14,840


Earnings per common share (dollars)			0.75	1.46	2.03	3.47

Earnings per common share - assuming dilution (dollars)			0.75	1.46	2.03	3.47

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(millions of dollars)

				Three Months Ended		Nine Months Ended
				September 30,		September 30,
				2019	2018	2019	2018

Net income including noncontrolling interests				3,247	6,446	9,044	15,215
Other comprehensive income (net of income taxes)
	Foreign exchange translation adjustment			(1,424)	124	(75)	(2,720)
	Adjustment for foreign exchange translation (gain)/loss
			included in net income	-	-	-	186
	Postretirement benefits reserves adjustment
			(excluding amortization)	103	(3)	43	(394)
	Amortization and settlement of postretirement benefits reserves
			adjustment included in net periodic benefit costs	186	223	512	689
		Total other comprehensive income		(1,135)	344	480	(2,239)
Comprehensive income including noncontrolling interests				2,112	6,790	9,524	12,976
	Comprehensive income attributable to
			noncontrolling interests	14	311	587	205
Comprehensive income attributable to ExxonMobil				2,098	6,479	8,937	12,771

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(millions of dollars)

				Sept. 30,	Dec. 31,
				2019	2018
Assets
	Current assets
		Cash and cash equivalents		5,351	3,042
		Notes and accounts receivable – net		25,308	24,701
		Inventories
			Crude oil, products and merchandise	13,131	14,803
			Materials and supplies	4,459	4,155
		Other current assets		1,759	1,272
			Total current assets	50,008	47,973
	Investments, advances and long-term receivables			42,920	40,790
	Property, plant and equipment – net			250,512	247,101
	Other assets, including intangibles – net			15,921	10,332
			Total assets	359,361	346,196

Liabilities
	Current liabilities
		Notes and loans payable		21,196	17,258
		Accounts payable and accrued liabilities		40,541	37,268
		Income taxes payable		2,458	2,612
			Total current liabilities	64,195	57,138
	Long-term debt			25,950	20,538
	Postretirement benefits reserves			19,365	20,272
	Deferred income tax liabilities			26,513	27,244
	Long-term obligations to equity companies			4,232	4,382
	Other long-term obligations			21,997	18,094
			Total liabilities	162,252	147,668

Commitments and contingencies (Note 3)				-	-

Equity
	Common stock without par value
		(9,000 million shares authorized, 8,019 million shares issued)		15,795	15,258
	Earnings reinvested			419,367	421,653
	Accumulated other comprehensive income			(19,277)	(19,564)
	Common stock held in treasury
		(3,788 million shares at September 30, 2019 and
		3,782 million shares at December 31, 2018)		(225,970)	(225,553)
			ExxonMobil share of equity	189,915	191,794
	Noncontrolling interests			7,194	6,734
			Total equity	197,109	198,528
			Total liabilities and equity	359,361	346,196

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(millions of dollars)

				Nine Months Ended
				September 30,
				2019	2018
Cash flows from operating activities
	Net income including noncontrolling interests			9,044	15,215
	Depreciation and depletion			14,075	13,717
	Changes in operational working capital, excluding cash and debt			2,564	(25)
	All other items – net			(2,319)	(1,500)
			Net cash provided by operating activities	23,364	27,407

Cash flows from investing activities
	Additions to property, plant and equipment			(17,657)	(13,480)
	Proceeds associated with sales of subsidiaries, property, plant and
		equipment, and sales and returns of investments		600	3,239
	Additional investments and advances			(2,532)	(1,113)
	Other investing activities including collection of advances			769	492
			Net cash used in investing activities	(18,820)	(10,862)

Cash flows from financing activities
	Additions to long-term debt			7,019	-
	Reductions in short-term debt			(3,836)	(4,279)
	Additions/(reductions) in commercial paper, and debt with three
		months or less maturity (1)		6,139	1,626
	Cash dividends to ExxonMobil shareholders			(10,936)	(10,296)
	Cash dividends to noncontrolling interests			(157)	(192)
	Changes in noncontrolling interests			30	(374)
	Common stock acquired			(421)	(430)
			Net cash used in financing activities	(2,162)	(13,945)
Effects of exchange rate changes on cash				(73)	(108)
Increase/(decrease) in cash and cash equivalents				2,309	2,492
Cash and cash equivalents at beginning of period				3,042	3,177
Cash and cash equivalents at end of period				5,351	5,669

Supplemental Disclosures
	Income taxes paid			5,259	6,740
	Cash interest paid
		Included in cash flows from operating activities		515	337
		Capitalized, included in cash flows from investing activities		540	502
		Total cash interest paid		1,055	839

(1) Includes a net addition of commercial paper with a maturity of over three months of $3.1 billion in 2019 and $0.3 billion in 2018. The gross amount of commercial paper with a maturity of over three months issued was $13.4 billion in 2019 and $3.1 billion in 2018, while the gross amount repaid was $10.3 billion in 2019 and $2.8 billion in 2018.

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

	EXXON MOBIL CORPORATION
	CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
	(millions of dollars)

			ExxonMobil Share of Equity
							Accumulated
								Other		Common
								Compre-		Stock		ExxonMobil		Non-
			Common		Earnings			hensive		Held in		Share of		controlling		Total
			Stock		Reinvested			Income		Treasury		Equity		Interests		Equity

Balance as of June 30, 2018				15,086		416,418			(18,609)		(225,673)		187,222		6,311		193,533
	Amortization of stock-based awards			169		-			-		-		169		-		169
	Other			(1)		-			-		-		(1)		(1)		(2)
	Net income for the period			-		6,240			-		-		6,240		206		6,446
	Dividends - common shares			-		(3,503)			-		-		(3,503)		(57)		(3,560)
	Other comprehensive income			-		-			239		-		239		105		344
	Acquisitions, at cost			-		-			-		(1)		(1)		(98)		(99)
Balance as of September 30, 2018				15,254		419,155			(18,370)		(225,674)		190,365		6,466		196,831

Balance as of June 30, 2019				15,639		419,913			(18,205)		(225,970)		191,377		7,088		198,465
	Amortization of stock-based awards			156		-			-		-		156		-		156
	Other			-		-			-		-		-		275		275
	Net income for the period			-		3,170			-		-		3,170		77		3,247
	Dividends - common shares			-		(3,716)			-		-		(3,716)		(57)		(3,773)
	Other comprehensive income			-		-			(1,072)		-		(1,072)		(63)		(1,135)
	Acquisitions, at cost			-		-			-		-		-		(79)		(79)
	Dispositions			-		-			-		-		-		(47)		(47)
Balance as of September 30, 2019				15,795		419,367			(19,277)		(225,970)		189,915		7,194		197,109



			Three Months Ended September 30, 2019									Three Months Ended September 30, 2018
					Held in									Held in
	Common Stock Share Activity		Issued		Treasury			Outstanding				Issued		Treasury		Outstanding
			(millions of shares)									(millions of shares)

	Balance as of June 30			8,019		(3,788)			4,231				8,019		(3,785)		4,234
		Acquisitions		-		-			-				-		-		-
		Dispositions		-		-			-				-		-		-
	Balance as of September 30			8,019		(3,788)			4,231				8,019		(3,785)		4,234

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

	EXXON MOBIL CORPORATION
	CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
	(millions of dollars)

			ExxonMobil Share of Equity
							Accumulated
								Other		Common
								Compre-		Stock		ExxonMobil		Non-
			Common		Earnings			hensive		Held in		Share of		controlling		Total
			Stock		Reinvested			Income		Treasury		Equity		Interests		Equity

Balance as of December 31, 2017				14,656		414,540			(16,262)		(225,246)		187,688		6,812		194,500
	Amortization of stock-based awards			605		-			-		-		605		-		605
	Other			(7)		-			-		-		(7)		(8)		(15)
	Net income for the period			-		14,840			-		-		14,840		375		15,215
	Dividends - common shares			-		(10,296)			-		-		(10,296)		(192)		(10,488)
	Cumulative effect of accounting
		change		-		71			(39)		-		32		15		47
	Other comprehensive income			-		-			(2,069)		-		(2,069)		(170)		(2,239)
	Acquisitions, at cost			-		-			-		(430)		(430)		(366)		(796)
	Dispositions			-		-			-		2		2		-		2
Balance as of September 30, 2018				15,254		419,155			(18,370)		(225,674)		190,365		6,466		196,831

Balance as of December 31, 2018				15,258		421,653			(19,564)		(225,553)		191,794		6,734		198,528
	Amortization of stock-based awards			545		-			-		-		545		-		545
	Other			(8)		-			-		-		(8)		275		267
	Net income for the period			-		8,650			-		-		8,650		394		9,044
	Dividends - common shares			-		(10,936)			-		-		(10,936)		(157)		(11,093)
	Other comprehensive income			-		-			287		-		287		193		480
	Acquisitions, at cost			-		-			-		(421)		(421)		(245)		(666)
	Dispositions			-		-			-		4		4		-		4
Balance as of September 30, 2019				15,795		419,367			(19,277)		(225,970)		189,915		7,194		197,109



			Nine Months Ended September 30, 2019									Nine Months Ended September 30, 2018
					Held in									Held in
	Common Stock Share Activity		Issued		Treasury			Outstanding				Issued		Treasury		Outstanding
			(millions of shares)									(millions of shares)

	Balance as of December 31			8,019		(3,782)			4,237				8,019		(3,780)		4,239
		Acquisitions		-		(6)			(6)				-		(5)		(5)
		Dispositions		-		-			-				-		-		-
	Balance as of September 30			8,019		(3,788)			4,231				8,019		(3,785)		4,234

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

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 2018 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. Prior data has been reclassified in certain cases to conform to the current presentation basis.

The Corporation's exploration and production activities are accounted for under the "successful efforts" method.

2.Accounting Changes

Effective January 1, 2019, the Corporation adopted the Financial Accounting Standards Board’s Standard, Leases (Topic 842), as amended. The standard requires all leases to be recorded on the balance sheet as a right of use asset and a lease liability. The Corporation used a transition method that applies the new lease standard at January 1, 2019. The Corporation applied a policy election to exclude short-term leases from balance sheet recognition and also elected certain practical expedients at adoption. As permitted, the Corporation did not reassess whether existing contracts are or contain leases, the lease classification for any existing leases, initial direct costs for any existing lease and whether existing land easements and rights of way, which were not previously accounted for as leases, are or contain a lease. At adoption on January 1, 2019, an operating lease liability of $3.3 billion was recorded and the operating lease right of use asset was $4.3 billion, including $1.0 billion of previously recorded prepaid leases. There was no cumulative earnings effect adjustment.

Effective January 1, 2020, ExxonMobil will adopt the Financial Accounting Standards Board’s update, Financial Instruments – Credit Losses (Topic 326), as amended. The standard requires a valuation allowance for credit losses be recognized for certain financial assets that reflects the current expected credit loss over the asset’s contractual life. The valuation allowance considers the risk of loss, even if remote, and considers past events, current conditions and expectations of the future. The Corporation does not expect a material change in the credit allowance for trade receivables and continues to evaluate the impact on other financial assets in scope of the standard.

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. For purposes of our contingency disclosures, “significant” includes material matters, as well as other matters which management believes should be disclosed. 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 material adverse effect upon the Corporation's operations, financial condition, or financial statements taken as a whole.

Other Contingencies

The Corporation and certain of its consolidated subsidiaries were contingently liable at September 30, 2019, for guarantees relating to notes, loans and performance under contracts. Where guarantees for environmental remediation and other similar matters do not include a stated cap, the amounts reflect management’s estimate of the maximum potential exposure. 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.

			As of September 30, 2019
			Equity	Other
			Company	Third Party
			Obligations (1)	Obligations	Total
			(millions of dollars)
Guarantees
	Debt-related		737	93	830
	Other		808	4,580	5,388
		Total	1,545	4,673	6,218

(1)	ExxonMobil share

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 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 Venezuelan nationalization decree issued in February 2007, a subsidiary of the Venezuelan National Oil Company (PdVSA) assumed the operatorship of the Cerro Negro Heavy Oil 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. 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.

ExxonMobil collected awards of $908 million in an arbitration against PdVSA under the rules of the International Chamber of Commerce in respect of an indemnity related to the Cerro Negro Project and $260 million in an arbitration for compensation due for the La Ceiba Project and for export curtailments at the Cerro Negro Project under rules of International Centre for Settlement of Investment Disputes (ICSID). An ICSID arbitration award relating to the Cerro Negro Project’s expropriation ($1.4 billion) was annulled based on a determination that a prior Tribunal failed to adequately explain why the cap on damages in the indemnity owed by PdVSA did not affect or limit the amount owed for the expropriation of the Cerro Negro Project. ExxonMobil filed a new claim seeking to restore the original award of damages for the Cerro Negro Project with ICSID on September 26, 2018.

The net impact of this matter on the Corporation’s consolidated financial results cannot be reasonably estimated. Regardless, the Corporation does not expect the resolution to have a material effect upon the Corporation’s operations or financial condition.

An affiliate of ExxonMobil is one of the Contractors under a Production Sharing Contract (PSC) with the Nigerian National Petroleum Corporation (NNPC) covering the Erha block located in the offshore waters of Nigeria. ExxonMobil's affiliate is the operator of the block and owns a 56.25 percent interest under the PSC. The Contractors are in dispute with NNPC regarding NNPC's lifting of crude oil in excess of its entitlement under the terms of the PSC. In accordance with the terms of the PSC, the Contractors initiated arbitration in Abuja, Nigeria, under the Nigerian Arbitration and Conciliation Act. On October 24, 2011, a three-member arbitral Tribunal issued an award upholding the Contractors' position in all material respects and awarding damages to the Contractors jointly in an amount of approximately $1.8 billion plus $234 million in accrued interest. The Contractors petitioned a Nigerian federal court for enforcement of the award, and NNPC petitioned the same court to have the award set aside. On May 22, 2012, the court set aside the award. The Contractors appealed that judgment to the Court of Appeal, Abuja Judicial Division. On July 22, 2016, the Court of Appeal upheld the decision of the lower court setting aside the award. On October 21, 2016, the Contractors appealed the decision to the Supreme Court of Nigeria. In June 2013, the Contractors filed a lawsuit against NNPC in the Nigerian federal high court in order to preserve their ability to seek enforcement of the PSC in the courts if necessary. Following dismissal by this court, the Contractors appealed to the Nigerian Court of Appeal in June 2016. In October 2014, the Contractors filed suit in the United States District Court for the Southern District of New York (SDNY) to enforce, if necessary, the arbitration award against NNPC assets residing within that jurisdiction. NNPC moved to dismiss the lawsuit. On September 4, 2019, the SDNY dismissed the Contractors’ petition to recognize and enforce the Erha arbitration award. The Contractors filed a notice of appeal in the Second Circuit on October 2, 2019. At this time, the net impact of this matter on the Corporation's consolidated financial results cannot be reasonably estimated. However, regardless of the outcome of enforcement proceedings, the Corporation does not expect the proceedings to have a material effect upon the Corporation's operations or financial condition.

4.Other Comprehensive Income Information

		Cumulative	Post-
		Foreign	retirement
		Exchange	Benefits
ExxonMobil Share of Accumulated Other		Translation	Reserves
Comprehensive Income		Adjustment	Adjustment	Total
		(millions of dollars)

Balance as of December 31, 2017		(9,482)	(6,780)	(16,262)
Current period change excluding amounts reclassified
	from accumulated other comprehensive income	(2,551)	(406)	(2,957)
Amounts reclassified from accumulated other
	comprehensive income	186	663	849
Total change in accumulated other comprehensive income		(2,365)	257	(2,108)
Balance as of September 30, 2018		(11,847)	(6,523)	(18,370)

Balance as of December 31, 2018		(13,881)	(5,683)	(19,564)
Current period change excluding amounts reclassified
	from accumulated other comprehensive income	(252)	48	(204)
Amounts reclassified from accumulated other
	comprehensive income	-	491	491
Total change in accumulated other comprehensive income		(252)	539	287
Balance as of September 30, 2019		(14,133)	(5,144)	(19,277)


			Three Months Ended		Nine Months Ended
Amounts Reclassified Out of Accumulated Other			September 30,		September 30,
Comprehensive Income - Before-tax Income/(Expense)			2019	2018	2019	2018
		(millions of dollars)

Foreign exchange translation gain/(loss) included in net income
	(Statement of Income line: Other income)		-	-	-	(186)
Amortization and settlement of postretirement benefits reserves
	adjustment included in net periodic benefit costs
	(Statement of Income line: Non-service pension and
	postretirement benefit expense)		(236)	(287)	(664)	(897)

			Three Months Ended		Nine Months Ended
Income Tax (Expense)/Credit For			September 30,		September 30,
Components of Other Comprehensive Income			2019	2018	2019	2018
		(millions of dollars)

Foreign exchange translation adjustment			1	8	1	13
Postretirement benefits reserves adjustment
	(excluding amortization)		(56)	-	(36)	66
Amortization and settlement of postretirement benefits reserves
	adjustment included in net periodic benefit costs		(50)	(64)	(152)	(208)
Total			(105)	(56)	(187)	(129)

5.Earnings Per Share

		Three Months Ended		Nine Months Ended
		September 30,		September 30,
		2019	2018	2019	2018

Earnings per common share
Net income attributable to ExxonMobil (millions of dollars)		3,170	6,240	8,650	14,840

Weighted average number of common shares
	outstanding (millions of shares)	4,271	4,271	4,270	4,271

Earnings per common share (dollars) (1)		0.75	1.46	2.03	3.47

Dividends paid per common share (dollars)		0.87	0.82	2.56	2.41

(1) The calculation of earnings per common share and earnings per common share – assuming dilution are the same in each period shown.

6.Pension and Other Postretirement Benefits

					Three Months Ended		Nine Months Ended
					September 30,		September 30,
					2019	2018	2019	2018
				(millions of dollars)
Components of net benefit cost
	Pension Benefits - U.S.
		Service cost			208	203	563	616
		Interest cost			192	179	574	540
		Expected return on plan assets			(143)	(182)	(427)	(545)
		Amortization of actuarial loss/(gain) and prior
			service cost		77	93	233	276
		Net pension enhancement and
			curtailment/settlement cost		54	63	161	189
		Net benefit cost			388	356	1,104	1,076

	Pension Benefits - Non-U.S.
		Service cost			136	149	413	461
		Interest cost			189	185	573	571
		Expected return on plan assets			(192)	(233)	(581)	(722)
		Amortization of actuarial loss/(gain) and prior
			service cost		102	113	260	344
		Net pension enhancement and
			curtailment/settlement cost		-	-	-	33
		Net benefit cost			235	214	665	687

	Other Postretirement Benefits
		Service cost			38	40	104	111
		Interest cost			79	75	237	226
		Expected return on plan assets			(4)	(5)	(12)	(17)
		Amortization of actuarial loss/(gain) and prior
			service cost		3	19	10	57
		Net benefit cost			116	129	339	377

7.Financial Instruments and Derivatives

Financial Instruments. The estimated fair value of financial instruments at September 30, 2019 and December 31, 2018, and the related hierarchy level for the fair value measurement is as follows:

			At September 30, 2019
			(millions of dollars)

			Fair Value
									Difference
						Total Gross	Effect of	Effect of	in Carrying	Net
						Assets	Counterparty	Collateral	Value and	Carrying
			Level 1	Level 2	Level 3	& Liabilities	Netting	Netting	Fair Value	Value
Assets
	Derivative assets (1)		483	80	-	563	(392)	(91)	-	80
	Advances to/receivables
		from equity companies (2)(7)	-	1,934	6,948	8,882	-	-	(149)	8,733
	Other long-term
		financial assets (3)	1,078	-	761	1,839	-	-	78	1,917

Liabilities
	Derivative liabilities (4)		414	58	-	472	(392)	(22)	-	58
	Long-term debt (5)		25,709	131	4	25,844	-	-	(1,175)	24,669
	Long-term obligations
		to equity companies (7)	-	-	4,466	4,466	-	-	(234)	4,232
	Other long-term
		financial liabilities (6)	-	-	1,054	1,054	-	-	(9)	1,045

			At December 31, 2018
			(millions of dollars)

			Fair Value
									Difference
						Total Gross	Effect of	Effect of	in Carrying	Net
						Assets	Counterparty	Collateral	Value and	Carrying
			Level 1	Level 2	Level 3	& Liabilities	Netting	Netting	Fair Value	Value
Assets
	Derivative assets (1)		297	-	-	297	(151)	(146)	-	-
	Advances to/receivables
		from equity companies (2)(7)	-	2,100	6,293	8,393	-	-	215	8,608
	Other long-term
		financial assets (3)	848	-	974	1,822	-	-	112	1,934

Liabilities
	Derivative liabilities (4)		151	-	-	151	(151)	-	-	-
	Long-term debt (5)		19,029	117	4	19,150	-	-	85	19,235
	Long-term obligations
		to equity companies (7)	-	-	4,330	4,330	-	-	52	4,382
	Other long-term
		financial liabilities (6)	-	-	1,046	1,046	-	-	(3)	1,043

(1)	Included in the Balance Sheet lines: Notes and accounts receivable, less estimated doubtful amounts and Other assets, including intangibles, net
(2)	Included in the Balance Sheet line: Investments, advances and long-term receivables
(3)	Included in the Balance Sheet lines: Investments, advances and long-term receivables and Other assets, including intangibles, net
(4)	Included in the Balance Sheet lines: Accounts payable and accrued liabilities and Other long-term obligations
(5)	Excluding finance lease obligations
(6)	Included in the Balance Sheet line: Other long-term obligations
(7)	Advances to/receivables from equity companies and long-term obligations to equity companies are mainly designated as hierarchy level 3 inputs. The fair value is calculated by discounting the remaining obligations by a rate consistent with the credit quality and industry of the equity company.

The increase in the estimated fair value and book value of long-term debt reflects the Corporation’s issuance of $7.0 billion of long-term debt in the third quarter of 2019. The $7.0 billion of long-term debt is comprised of $750 million of floating-rate notes due in 2022, $750 million of 1.902% notes due in 2022, $1,000 million of 2.019% notes due in 2024, $1,000 million of 2.275% notes due in 2026, $1,250 million of 2.440% notes due in 2029, $750 million of 2.995% notes due in 2039, and $1,500 million of 3.095% notes due in 2049. Additionally, the Corporation replaced a $5.0 billion short-term committed line of credit with a $7.5 billion short-term committed line of credit in the third quarter of 2019.

Derivative Instruments. The Corporation’s size, strong capital structure, geographic diversity and the complementary nature of the Upstream, Downstream and Chemical businesses reduce the Corporation’s enterprise-wide risk from changes in commodity prices, currency rates and interest rates. In addition, the Corporation uses commodity-based contracts, including derivatives, to manage commodity price risk and for trading purposes. Commodity contracts held for trading purposes are presented in the Consolidated Statement of Income on a net basis in the line “Sales and other operating revenue.” The Corporation’s commodity derivatives are not accounted for under hedge accounting. At times, the Corporation also enters into currency and interest rate derivatives, none of which are material to the Corporation’s financial position as of September 30, 2019 and December 31, 2018, or results of operations for the periods ended September 30, 2019 and 2018.

Credit risk associated with the Corporation’s derivative position is mitigated by several factors, including the use of derivative clearing exchanges and the quality of and financial limits placed on derivative counterparties. The Corporation maintains a system of controls that includes the authorization, reporting and monitoring of derivative activity.

At September 30, 2019, the net notional long/(short) position of derivative instruments was 12 million barrels for crude oil, (50) million barrels for products, and (146) million MMBtus of natural gas. At December 31, 2018, the net notional long/(short) position of derivative instruments was (19) million barrels for crude oil and (9) million barrels for products.

Realized and unrealized gains/(losses) on derivative instruments that were recognized in the Consolidated Statement of Income are included in the following lines on a before-tax basis:

		Three Months Ended		Nine Months Ended
		September 30,		September 30,
		2019	2018	2019	2018
		(millions of dollars)

Sales and other operating revenue		144	(68)	(98)	(72)
Crude oil and product purchases		60	(107)	75	(380)
	Total	204	(175)	(23)	(452)

8.Disclosures about Segments and Related Information

				Three Months Ended		Nine Months Ended
				September 30,		September 30,
				2019	2018	2019	2018
Earnings After Income Tax			(millions of dollars)
	Upstream
		United States		37	606	468	1,474
		Non-U.S.		2,131	3,623	7,837	9,292
	Downstream
		United States		673	961	822	1,975
		Non-U.S.		557	681	603	1,331
	Chemical
		United States		53	404	208	1,360
		Non-U.S.		188	309	739	1,254
	Corporate and financing			(469)	(344)	(2,027)	(1,846)
	Corporate total			3,170	6,240	8,650	14,840

Sales and Other Operating Revenue
	Upstream
		United States		1,941	2,728	7,228	7,637
		Non-U.S.		3,069	4,129	10,582	11,344
	Downstream
		United States		18,358	19,963	52,721	56,616
		Non-U.S.		33,391	39,077	100,994	110,855
	Chemical
		United States		2,412	3,152	7,421	9,160
		Non-U.S.		4,241	5,125	13,583	15,429
	Corporate and financing			10	13	30	38
	Corporate total			63,422	74,187	192,559	211,079

Intersegment Revenue
	Upstream
		United States		2,876	2,203	7,828	6,336
		Non-U.S.		7,383	8,536	22,888	22,788
	Downstream
		United States		5,439	5,834	16,942	16,527
		Non-U.S.		5,826	8,275	18,563	22,975
	Chemical
		United States		1,489	2,408	5,947	6,952
		Non-U.S.		1,413	1,841	4,543	5,657
	Corporate and financing			60	54	168	153

Geographic
		Three Months Ended		Nine Months Ended
		September 30,		September 30,
Sales and Other Operating Revenue		2019	2018	2019	2018
		(millions of dollars)

United States		22,711	25,843	67,370	73,413
Non-U.S.		40,711	48,344	125,189	137,666
	Total	63,422	74,187	192,559	211,079

Significant Non-U.S. revenue sources include: (1)
	Canada	4,945	6,214	15,141	17,752
	United Kingdom	4,042	4,797	13,244	14,240
	France	3,266	3,588	9,597	10,405
	Belgium	2,598	3,996	9,371	12,063
	Singapore	2,942	3,502	9,197	10,387
	Italy	2,691	3,316	7,830	9,684
	Australia	2,100	2,348	5,948	6,464
	Germany	1,964	2,518	5,879	7,184

(1) Revenue is determined by primary country of operations. Excludes certain sales and other operating revenues in Non-U.S. operations where attribution to a specific country is not practicable.

9.Leases

The Corporation and its consolidated affiliates generally purchase the property, plant and equipment used in operations, but there are situations where assets are leased, primarily for drilling equipment, tankers, office buildings, railcars, and other moveable equipment. Right of use assets and lease liabilities are established on the balance sheet for leases with an expected term greater than one year, by discounting the amounts fixed in the lease agreement for the duration of the lease which is reasonably certain, considering the probability of exercising any early termination and extension options. The portion of the fixed payment related to service costs for drilling equipment and tankers is excluded from the calculation of right of use assets and lease liabilities. Generally assets are leased only for a portion of their useful lives, and are accounted for as operating leases. In limited situations assets are leased for nearly all of their useful lives, and are accounted for as finance leases.

Variable payments under these lease agreements are not significant. Residual value guarantees, restrictions, or covenants related to leases, and transactions with related parties are also not significant. In general, leases are capitalized using the incremental borrowing rate of the leasing affiliate. The Corporation’s activities as a lessor are not significant.

At adoption of the lease accounting change (see Note 2), on January 1, 2019, an operating lease liability of $3.3 billion was recorded and the operating lease right of use asset was $4.3 billion, including $1.0 billion of previously recorded prepaid leases. There was no cumulative earnings effect adjustment.

		Operating Leases
			Drilling Rigs
			and Related			Finance
			Equipment	Other	Total	Leases
			(millions of dollars)

Lease Cost			Three Months Ended September 30, 2019
Operating lease cost			65	310	375
Short-term and other (net of sublease rental income)			259	216	475

Amortization of right of use assets						29
Interest on lease liabilities						35
	Total		324	526	850	64

Lease Cost		Nine Months Ended September 30, 2019
Operating lease cost		162	878	1,040
Short-term and other (net of sublease rental income)		712	846	1,558

Amortization of right of use assets					91
Interest on lease liabilities					102
	Total	874	1,724	2,598	193

			Operating Leases
				Drilling Rigs
				and Related			Finance
				Equipment	Other	Total	Leases
				(millions of dollars)

Balance Sheet				September 30, 2019
Right of use assets
	Included in Other assets, including intangibles - net			634	5,919	6,553
	Included in Property, plant and equipment - net						1,499
		Total right of use assets		634	5,919	6,553	1,499

Lease liability due within one year
	Included in Accounts payable and accrued liabilities			230	952	1,182	23
	Included in Notes and loans payable						169
Long-term lease liability
	Included in Other long-term obligations			383	4,014	4,397
	Included in Long-term debt						1,281
	Included in Long-term obligations to equity companies						139
		Total lease liability		613	4,966	5,579	1,612


Maturity Analysis of Lease Liabilities		September 30, 2019
2019 remaining months		58	299	357	173
2020		234	1,026	1,260	205
2021		138	795	933	182
2022		79	557	636	174
2023		44	451	495	173
2024		29	406	435	172
2025 and beyond		71	2,390	2,461	2,427
	Total lease payments	653	5,924	6,577	3,506
Discount to present value		(40)	(958)	(998)	(1,894)
	Total lease liability	613	4,966	5,579	1,612

Weighted average remaining lease term - years		4	10	10	25
Weighted average discount rate - percent		3.0%	3.2%	3.2%	9.8%

In addition to the lease liabilities in the table immediately above, at September 30, 2019, undiscounted commitments for leases not yet commenced totaled $0.7 billion for operating leases and $3.4 billion for finance leases. The finance leases relate to floating production storage and offloading vessels and a long-term hydrogen purchase agreement. The underlying assets for these finance leases were primarily designed by, and are being constructed by, the lessors.

		Operating Leases
			Drilling Rigs
			and Related			Finance
			Equipment	Other	Total	Leases
			(millions of dollars)

Other Information			Nine Months Ended September 30, 2019
Cash paid for amounts included in the measurement of lease liabilities
	Cash flows from operating activities			799	799	41
	Cash flows from investing activities		192		192
	Cash flows from financing activities					48

Noncash right of use assets recorded for lease liabilities
	For January 1 adoption of Topic 842		445	2,818	3,263
	In exchange for new lease liabilities during the period		341	2,872	3,213

At December 31, 2018, the Corporation and its consolidated subsidiaries held noncancelable operating leases and charters covering drilling equipment, tankers and other assets with minimum undiscounted lease commitments totaling $6,112 million as indicated in the table. Estimated related sublease rental income from noncancelable subleases totals $22 million.

	Lease Payments
	Under Minimum Commitments
	As of December 31, 2018
		Drilling Rigs
		and Related
		Equipment	Other	Total
		(millions of dollars)

2019		222	934	1,156
2020		166	819	985
2021		107	658	765
2022		43	506	549
2023		32	422	454
2024 and beyond		53	2,150	2,203
Total		623	5,489	6,112

Net rental cost under both cancelable and noncancelable operating leases incurred during 2018, 2017 and 2016 were as follows:

			For full year
			2018	2017	2016
			(millions of dollars)

Rental cost
	Drilling rigs and related equipment		723	792	1,274
	Other (net of sublease rental income)		1,992	1,826	1,817
		Total	2,715	2,618	3,091

10.Accounting for Suspended Exploratory Well Costs

For the category of exploratory well costs at year-end 2018 that were suspended more than one year, a total of $18 million was expensed in the first nine months of 2019.

11. Sale of Norway Assets

ExxonMobil signed an agreement with Vår Energi AS (Vår) for the sale of its non-operated upstream assets in Norway for $4.5 billion. The transaction is expected to close in the fourth quarter of 2019, subject to standard conditions precedent, including customary approvals from regulatory authorities. The agreed sales price of $4.5 billion is subject to interim period adjustments from the effective date of January 1, 2019, to the closing date, and obligations for income taxes from the effective date will transfer to Vår. Estimated total cash flow from the divestment is around $3.5 billion after closing adjustments, with expected 2019 cash proceeds of around $2.6 billion and estimated cash flow in future periods associated with deferred consideration of $0.3 billion and an estimated refund of income tax payments of $0.6 billion. The Corporation expects to recognize a gain of approximately $3.5 billion at closing. Estimated gain and net cash flow could change significantly due to market factors and timing of close.

EXXON MOBIL CORPORATION

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

FUNCTIONAL EARNINGS SUMMARY

			Third Quarter		First Nine Months
Earnings (U.S. GAAP)			2019	2018	2019	2018
		(millions of dollars)
Upstream
	United States		37	606	468	1,474
	Non-U.S.		2,131	3,623	7,837	9,292
Downstream
	United States		673	961	822	1,975
	Non-U.S.		557	681	603	1,331
Chemical
	United States		53	404	208	1,360
	Non-U.S.		188	309	739	1,254
Corporate and financing			(469)	(344)	(2,027)	(1,846)
	Net income attributable to ExxonMobil (U.S. GAAP)		3,170	6,240	8,650	14,840

Earnings per common share (dollars)			0.75	1.46	2.03	3.47

Earnings per common share - assuming dilution (dollars)			0.75	1.46	2.03	3.47

References in this discussion to Corporate earnings mean net income attributable to ExxonMobil (U.S. GAAP) from the consolidated income statement. Unless otherwise indicated, references to earnings, 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 THIRD QUARTER 2019 RESULTS

ExxonMobil’s third quarter 2019 earnings were $3.2 billion, or $0.75 per diluted share, compared with $6.2 billion a year earlier. The decrease in earnings was primarily the result of lower Upstream realizations, weaker Downstream and Chemical margins, increased expenses, less favorable one-time tax items, and higher scheduled maintenance activity. These impacts were partly offset by Upstream volume growth.

Earnings of $8.7 billion for the first nine months of 2019 were down 42 percent from $14.8 billion in 2018.

Earnings per share assuming dilution were $2.03.

Capital and exploration expenditures were $22.7 billion, up 25 percent from 2018.

Oil-equivalent production was 3.9 million barrels per day, up 4 percent from the prior year. Excluding entitlement effects and divestments, oil-equivalent production was also up 4 percent.

The Corporation distributed $10.9 billion in dividends to shareholders.

				Third Quarter		First Nine Months
				2019	2018	2019	2018
			(millions of dollars)
Upstream earnings
	United States			37	606	468	1,474
	Non-U.S.			2,131	3,623	7,837	9,292
		Total		2,168	4,229	8,305	10,766

Upstream earnings were $2,168 million in the third quarter of 2019, down $2,061 million from the third quarter of 2018.

·	Realizations reduced earnings by $1,510 million, mainly due to lower liquids realizations.
·	Higher volume and mix effects increased earnings by $230 million due to higher liquids volumes of $190 million and increased gas volumes of $40 million.
·	All other items decreased earnings by $780 million, mainly due to higher expenses of $410 million and the absence of a favorable one-time tax item of $271 million in the prior year quarter.
·	U.S. Upstream earnings were $37 million, down $569 million from the prior year quarter.
·	Non-U.S. Upstream earnings were $2,131 million, down $1,492 million from the prior year quarter.
·	On an oil-equivalent basis, production increased 3 percent from the third quarter of 2018.
·	Liquids production totaled 2.4 million barrels per day, up 106,000 barrels per day mainly driven by growth.
·	Natural gas production was 9.0 billion cubic feet per day, up 44 million cubic feet per day driven by growth, partly offset by higher downtime and divestments.

Upstream earnings were $8,305 million in the first nine months of 2019, down $2,461 million from the first nine months of 2018.

·	Realizations reduced earnings by $2,280 million, mainly due to lower liquids realizations.
·	Higher volume and mix effects increased earnings by $1,030 million due to higher liquids volumes.
·	All other items decreased earnings by $1,210 million, as higher expenses of $970 million, impairment charges, and the absence of asset management gains and a favorable one-time tax item in the prior year were partly offset by a favorable one-time tax item in the current year.
·	U.S. Upstream earnings were $468 million, down $1,006 million from the prior year.
·	Non-U.S. Upstream earnings were $7,837 million, down $1,455 million from the prior year.
·	On an oil-equivalent basis, production increased 4 percent from the first nine months of 2018.
·	Liquids production totaled 2.4 million barrels per day, up 131,000 barrels per day due to growth and lower downtime.
·	Natural gas production was 9.4 billion cubic feet per day, up 147 million cubic feet per day driven by growth and lower downtime.

		Third Quarter		First Nine Months
Upstream additional information			(thousands of barrels daily)
Volumes reconciliation (Oil-equivalent production)(1)
2018			3,786		3,774
	Entitlements - Net Interest		-		-
	Entitlements - Price / Spend / Other		23		19
	Quotas		-		-
	Divestments		(12)		(16)
	Growth / Other		102		152
2019			3,899		3,929

(1) Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels.

Listed below are descriptions of ExxonMobil’s volumes reconciliation factors which are provided to facilitate understanding of the terms.

Entitlements - Net Interest are changes to ExxonMobil’s share of production volumes caused by non-operational changes to volume-determining factors. These factors consist of net interest changes specified in Production Sharing Contracts (PSCs) which typically occur when cumulative investment returns or production volumes achieve defined thresholds, changes in equity upon achieving pay-out in partner investment carry situations, equity redeterminations as specified in venture agreements, or as a result of the termination or expiry of a concession. Once a net interest change has occurred, it typically will not be reversed by subsequent events, such as lower crude oil prices.

Entitlements - Price, Spend and Other are changes to ExxonMobil’s share of production volumes resulting from temporary changes to non-operational volume-determining factors. These factors include changes in oil and gas prices or spending levels from one period to another. According to the terms of contractual arrangements or government royalty regimes, price or spending variability can increase or decrease royalty burdens and/or volumes attributable to ExxonMobil. For example, at higher prices, fewer barrels are required for ExxonMobil to recover its costs. These effects generally vary from period to period with field spending patterns or market prices for oil and natural gas. Such factors can also include other temporary changes in net interest as dictated by specific provisions in production agreements.

Quotas are changes in ExxonMobil’s allowable production arising from production constraints imposed by countries which are members of the Organization of the Petroleum Exporting Countries (OPEC). Volumes reported in this category would have been readily producible in the absence of the quota.

Divestments are reductions in ExxonMobil’s production arising from commercial arrangements to fully or partially reduce equity in a field or asset in exchange for financial or other economic consideration.

Growth and Other factors comprise all other operational and non-operational factors not covered by the above definitions that may affect volumes attributable to ExxonMobil. Such factors include, but are not limited to, production enhancements from project and work program activities, acquisitions including additions from asset exchanges, downtime, market demand, natural field decline, and any fiscal or commercial terms that do not affect entitlements.

				Third Quarter		First Nine Months
				2019	2018	2019	2018
			(millions of dollars)
Downstream earnings
	United States			673	961	822	1,975
	Non-U.S.			557	681	603	1,331
		Total		1,230	1,642	1,425	3,306

Downstream earnings were $1,230 million in the third quarter of 2019, down $412 million from the third quarter of 2018.

·	Margins reduced earnings by $340 million, mainly due to lower U.S. margins.
·	Lower volume and mix effects decreased earnings by $20 million.
·	All other items reduced earnings by $50 million as higher expenses were partly offset by favorable foreign exchange and tax effects.
·	U.S. Downstream earnings were $673 million, down $288 million from the prior year quarter.
·	Non-U.S. Downstream earnings were $557 million, down $124 million from the prior year quarter.
·	Petroleum product sales of 5.5 million barrels per day were 112,000 barrels per day lower than the prior year quarter.

Downstream earnings were $1,425 million in the first nine months of 2019, down $1,881 million from the first nine months of 2018.

·	Margins reduced earnings by $1,430 million, reflecting lower U.S. and Non-U.S. margins.
·	Lower volume and mix effects decreased earnings by $80 million.
·	All other items reduced earnings by $370 million as higher expenses were partly offset by favorable foreign exchange effects.
·	U.S. Downstream earnings were $822 million, down $1,153 million from the prior year.
·	Non-U.S. Downstream earnings were $603 million, down $728 million from the prior year.
·	Petroleum product sales of 5.4 million barrels per day were 74,000 barrels per day lower than the prior year.

				Third Quarter		First Nine Months
				2019	2018	2019	2018
			(millions of dollars)
Chemical earnings
	United States			53	404	208	1,360
	Non-U.S.			188	309	739	1,254
		Total		241	713	947	2,614

Chemical earnings were $241 million in the third quarter of 2019, down $472 million from the third quarter of 2018.

·	Weaker margins reduced earnings by $350 million.
·	Volume and mix effects decreased earnings by $60 million.
·	All other items decreased earnings by $60 million, including the impact of higher expenses.
·	U.S. Chemical earnings were $53 million, down $351 million from the prior year quarter.
·	Non-U.S. Chemical earnings were $188 million, down $121 million from the prior year quarter.
·	Third quarter prime product sales of 6.5 million metric tons were 201,000 metric tons lower than the prior year quarter.

Chemical earnings were $947 million in the first nine months of 2019, down $1,667 million from the first nine months of 2018.

·	Weaker margins reduced earnings by $1,140 million.
·	Volume and mix effects were essentially flat.
·	All other items decreased earnings by $530 million due to higher expenses and unfavorable foreign exchange effects.
·	U.S. Chemical earnings were $208 million, down $1,152 million from the prior year.
·	Non-U.S. Chemical earnings were $739 million, down $515 million from the prior year.
·	Prime product sales of 19.9 million metric tons in the first nine months of 2019 were 250,000 metric tons lower than the first nine months of the prior year.

		Third Quarter		First Nine Months
		2019	2018	2019	2018
	(millions of dollars)

Corporate and financing earnings		(469)	(344)	(2,027)	(1,846)

Corporate and financing expenses were $469 million for the third quarter of 2019, up $125 million from the third quarter of 2018.

Corporate and financing expenses were $2,027 million for the first nine months of 2019, up $181 million from the first nine months of 2018.

LIQUIDITY AND CAPITAL RESOURCES

				Third Quarter		First Nine Months
				2019	2018	2019	2018
			(millions of dollars)
Net cash provided by/(used in)
	Operating activities					23,364	27,407
	Investing activities					(18,820)	(10,862)
	Financing activities					(2,162)	(13,945)
Effect of exchange rate changes						(73)	(108)
Increase/(decrease) in cash and cash equivalents						2,309	2,492

Cash and cash equivalents (at end of period)						5,351	5,669

Cash flow from operations and asset sales
	Net cash provided by operating activities (U.S. GAAP)			9,079	11,108	23,364	27,407
	Proceeds associated with sales of subsidiaries, property,
		plant & equipment, and sales and returns of investments		460	1,491	600	3,239
	Cash flow from operations and asset sales			9,539	12,599	23,964	30,646

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

Cash flow from operations and asset sales in the third quarter of 2019 was $9.5 billion, including asset sales of $0.5 billion, a decrease of $3.1 billion from the comparable 2018 period primarily reflecting lower earnings and asset sale proceeds.

Cash provided by operating activities totaled $23.4 billion for the first nine months of 2019, $4.0 billion lower than 2018. The major source of funds was net income including noncontrolling interests of $9.0 billion, a decrease of $6.2 billion from the prior year period. The adjustment for the noncash provision of $14.1 billion for depreciation and depletion was up $0.4 billion from 2018. Changes in operational working capital contributed $2.6 billion, compared to a decrease of $25 million in the prior year period. All other items net decreased cash flows by $2.3 billion in 2019 versus a reduction of $1.5 billion in 2018. See the Condensed Consolidated Statement of Cash Flows for additional details.

Investing activities for the first nine months of 2019 used net cash of $18.8 billion, an increase of $8.0 billion compared to the prior year. Spending for additions to property, plant and equipment of $17.7 billion was $4.2 billion higher than 2018. Proceeds from asset sales of $0.6 billion decreased $2.6 billion. Investments and advances increased $1.4 billion to $2.5 billion.

Cash flow from operations and asset sales in the first nine months of 2019 was $24.0 billion, including asset sales of $0.6 billion, a decrease of $6.7 billion from the comparable 2018 period primarily reflecting lower earnings and asset sale proceeds.

During the third quarter of 2019, the Corporation issued $7.0 billion of long-term debt and used part of the proceeds to reduce short-term debt. Net cash used by financing activities was $2.2 billion in the first nine months of 2019, $11.8 billion lower than 2018 reflecting the 2019 debt issuance.

Total debt at the end of the third quarter of 2019 was $47.1 billion compared to $37.8 billion at year-end 2018. The Corporation's debt to total capital ratio was 19.3 percent at the end of the third quarter of 2019 compared to 16.0 percent at year-end 2018.

The Corporation has access to significant capacity of long-term and short-term liquidity. Internally generated funds are generally expected to cover financial requirements, supplemented by short-term and long-term debt as required. The Corporation replaced a $5.0 billion short-term committed line of credit with a $7.5 billion short-term committed line of credit in the third quarter of 2019.

During the first nine months of 2019, Exxon Mobil Corporation purchased 5 million shares of its common stock for the treasury at a gross cost of $0.4 billion. These purchases were made to offset shares or units settled in shares issued in conjunction with the company’s benefit plans and programs. Shares outstanding decreased from 4,237 million at year-end 2018 to 4,231 million at the end of the third quarter of 2019. Purchases may be made both in the open market and through negotiated transactions, and may be increased, decreased or discontinued at any time without prior notice.

The Corporation distributed a total of $10.9 billion to shareholders in the first nine months of 2019 through dividends.

Total cash and cash equivalents of $5.4 billion at the end of the third quarter of 2019 compared to $3.0 billion at year-end 2018.

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. Additionally, the Corporation continues to evaluate opportunities to enhance its business portfolio through acquisitions of assets or companies, and enters into such transactions from time to time. Key criteria for evaluating acquisitions include potential for future growth and attractive current valuations. Acquisitions may be made with cash, shares of the Corporation’s common stock, or both.

Litigation and other contingencies are discussed in Note 3 to the unaudited condensed consolidated financial statements.

TAXES

				Third Quarter				First Nine Months
				2019		2018		2019		2018
			(millions of dollars)

Income taxes				1,474		2,634		4,598		7,617
	Effective income tax rate			37	%	34	%	41	%	39	%
Total other taxes and duties (1)				8,317		8,939		24,770		26,757
		Total		9,791		11,573		29,368		34,374

(1) Includes “Other taxes and duties” plus taxes that are included in “Production and manufacturing expenses” and “Selling, general and administrative expenses.”

Total taxes were $9.8 billion for the third quarter of 2019, a decrease of $1.8 billion from 2018. Income tax expense decreased by $1.2 billion to $1.5 billion reflecting lower pre-tax income. The effective income tax rate was 37 percent compared to 34 percent in the prior year period due to a higher share of earnings in higher tax jurisdictions. Total other taxes and duties decreased by $0.6 billion to $8.3 billion.

Total taxes were $29.4 billion for the first nine months of 2019, a decrease of $5.0 billion from 2018. Income tax expense decreased by $3.0 billion to $4.6 billion reflecting lower pre-tax income. The effective income tax rate was 41 percent compared to 39 percent in the prior year period due to a higher share of earnings in higher tax jurisdictions. Total other taxes and duties decreased by $2.0 billion to $24.8 billion.

In the United States, the Corporation has various ongoing U.S. federal income tax positions at issue with the Internal Revenue Service (IRS) for tax years beginning in 2006. The IRS has asserted penalties associated with several of those positions. The Corporation has not recognized the penalties as an expense because the Corporation does not expect the penalties to be sustained under applicable law. The Corporation has filed a refund suit for tax years 2006-2009 in a U.S. federal district court with respect to the positions at issue for those years. The trial for those tax issues was completed at the end of June 2019 and the Corporation is awaiting a decision, which may be appealed by either side. Unfavorable resolution of all positions at issue with the IRS would not have a materially adverse effect on the Corporation’s net income or liquidity.

CAPITAL AND EXPLORATION EXPENDITURES

			Third Quarter		First Nine Months
			2019	2018	2019	2018
		(millions of dollars)

Upstream (including exploration expenses)			5,791	5,330	17,394	13,944
Downstream			1,069	719	3,011	2,563
Chemical			852	526	2,266	1,524
Other			7	11	17	49
	Total		7,719	6,586	22,688	18,080

Capital and exploration expenditures in the third quarter of 2019 were $7.7 billion, up 17 percent from the third quarter of 2018.

Capital and exploration expenditures in the first nine months of 2019 were $22.7 billion, up 25 percent from the first nine months of 2018 due primarily to growth in the U.S. Permian Basin. The Corporation anticipates an investment level of approximately $30 billion in 2019. Actual spending could vary depending on the progress of individual projects and property acquisitions.

RECENTLY ISSUED ACCOUNTING STANDARDS

FORWARD-LOOKING STATEMENTS

Statements related to outlooks, projections, goals, targets, descriptions of strategic plans and objectives, and other statements of future events or conditions are forward-looking statements. Actual future results, including business and project plans, capacities, costs, and timing; resource recoveries and production rates; and the impact of new technologies, including to increase capital efficiency and production and to reduce greenhouse gas emissions, could differ materially due to a number of factors. These include global or regional changes in supply and demand for oil, gas, and petrochemicals and other market conditions that impact prices and differentials; reservoir performance; the outcome of exploration projects and timely completion of development and construction projects; the impact of fiscal and commercial terms and the outcome of commercial negotiations or acquisitions; changes in law, taxes, or regulation including environmental regulations, and timely granting of governmental permits; war, trade relations, shipping blockades or harassment, and other political or security disturbances; opportunities for and regulatory approval of potential investments or divestments; the actions of competitors; the capture of efficiencies between business lines; unforeseen technical or operating difficulties; unexpected technological developments; the ability to bring new technologies to commercial scale on a cost-competitive basis, including large-scale hydraulic fracturing projects; general economic conditions including the occurrence and duration of economic recessions; the results of research programs; and other factors discussed under the heading Factors Affecting Future Results on the Investors page of our website at www.exxonmobil.com and in Item 1A of ExxonMobil’s 2018 Form 10-K. We assume no duty to update these statements as of any future date.

The term “project” as used in this report can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Information about market risks for the nine months ended September 30, 2019, does not differ materially from that discussed under Item 7A of the registrant's Annual Report on Form 10-K for 2018.

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 September 30, 2019. 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

On August 5, 2019, the State of Texas, acting by and through its Attorney General, on behalf of the Texas Commission on Environmental Quality (State), filed a lawsuit against the Corporation due to an alleged fire that occurred on July 31, 2019, at the Baytown Olefins Plant in Texas. The State alleges that ExxonMobil violated, and continues to violate, the Texas Water Code, the Texas Clean Air Act, ExxonMobil’s permits and promulgated regulations for alleged unauthorized air pollution, unauthorized outdoor burning, nuisance, unauthorized visible emissions, and unauthorized discharge of firefighting wastewater at the plant. The State is seeking civil penalties in an undisclosed amount but likely in excess of $100,000 and injunctive relief against ExxonMobil. The State is also seeking to recover its fees and costs of litigation.

As reported in the Corporation’s Form 10-Q for the first and second quarters of 2019, on March 20, 2019, the State of California Air Resources Board (CARB) informed ExxonMobil Oil Corporation (EMOC) of its intention to attempt to settle an enforcement matter involving the formerly owned Torrance Refinery in California under the California Health and Safety Code. Specifically, CARB contended that the refinery failed to timely calibrate and inspect a greenhouse gas reporting meter as required by the applicable regulations and to accurately report greenhouse gas emissions from refinery operations in 2014 and 2015 in a manner consistent with applicable regulations. The alleged violations have been corrected. On or about June 7, 2019, CARB and EMOC agreed on a penalty of $493,500 to resolve the matter. The settlement agreement was fully executed by all parties on July 15, 2019, and the final settlement payment to CARB pursuant to the settlement agreement was paid on or about August 6, 2019.

As last reported in the Corporation’s Form 10-Q for the second quarter of 2019, on July 20, 2017, the United States Department of Treasury, Office of Foreign Assets Control (OFAC) assessed a civil penalty against Exxon Mobil Corporation, ExxonMobil Development Company and ExxonMobil Oil Corporation for violating the Ukraine-Related Sanctions Regulations, 31 C.F.R. part 589. The assessed civil penalty is in the amount of $2,000,000. ExxonMobil and its affiliates have been and continue to be in compliance with all sanctions and disagree that any violation has occurred. ExxonMobil and its affiliates filed a complaint on July 20, 2017, in the United States Federal District Court, Northern District of Texas seeking judicial review of, and to enjoin, the civil penalty under the Administrative Procedures Act and the United States Constitution, including on the basis that it represents an arbitrary and capricious action by OFAC and a violation of the Company’s due process rights.

Refer to the relevant portions of Note 3 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 September 30, 2019

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

July 2019		-	-	-
August 2019		-	-	-
September 2019		-	-	-
	Total	-		-	(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 earnings release dated February 2, 2016, the Corporation stated it will continue to acquire shares to offset dilution in conjunction with benefit plans and programs, but had suspended making purchases to reduce shares outstanding effective beginning the first quarter of 2016.

Item 6. Exhibits

See Index to Exhibits of this report.

INDEX TO EXHIBITS

Exhibit		Description

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 (formatted as Inline XBRL).
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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: November 6, 2019	By:	/s/ DAVID S. ROSENTHAL
		David S. Rosenthal
		Vice President, Controller and
		Principal Accounting Officer