ExxonMobil (XOM) Q1 2026 Earnings Transcript

Image source: The Motley Fool.

DATE

Friday, May 1, 2026 at 9:30 a.m. ET

CALL PARTICIPANTS

• Chairman and Chief Executive Officer — Darren Woods
• Senior Vice President and Chief Financial Officer — Kathy Mikells
• Vice President, Investor Relations — Jim Chapman

TAKEAWAYS

• Upstream Production Growth -- Excluding external disruptions (Middle East, Kazakhstan, Permian winter storm), Upstream production rose 8% year over year, attributed to growth in the Permian and Guyana.
• Permian Basin Production -- Exxon Mobil (NYSE:XOM) remains on track to reach 1.8 million oil-equivalent barrels per day in full-year 2026 output, with growth focused on value rather than volume.
• Guyana Production -- Achieved record production and maintained strong reliability, with projects including Oahu, Whiptail, and Hammerhead under construction; Oahu is expected to deliver first oil by year-end.
• Golden Pass LNG Startup -- First LNG achieved in March; Train one increases U.S. LNG exports by approximately 5% relative to 2025, with total exports expected to rise by about 15% after all three trains are online.
• Energy Products Segment Earnings -- Delivered $2.8 billion in the quarter, up $2 billion year over year and a few hundred million dollars sequentially from Q4 2025, driven by high-margin assets and expanded trading capability.
• Refinery Utilization -- Gulf Coast refineries operated at record utilization rates; March throughput increased by 200,000 barrels per day versus February as deferred maintenance returned capacity to service.
• Cost Structure -- Structural cost reductions and execution improvements continue to drive enhanced financial performance, with management emphasizing these as core to navigating volatility.
• Low Carbon Solutions Progress -- Began transporting and storing CO2 from the New Generation Gas Gathering Project, the second such startup within a year, with plans for additional 4 million tons per year capture capacity within the next two years.
• Beaumont Refinery Payback -- The 2023 Beaumont refinery expansion has fully recovered its investment ahead of expectations, now generating improved margins and cash flows.
• Technology Deployment -- Implemented fully autonomous well section technology offshore Guyana, enabling enhanced safety and efficiency in deepwater operations.
• Enterprise Transformation -- Major global workforce enablement system launched, streamlining processes across more than 50 countries with no business disruption, as part of a multiyear platform overhaul.
• Global Supply Chain Response -- Leveraged global portfolio and real-time vessel visibility to maintain customer deliveries amid supply disruptions, executing alternate routings to Asia.
• Capital Project Timing -- Mozambique and Papua New Guinea LNG projects expected to reach final investment decisions later this year, adding diversification and capacity.
• STEM Commitment in Guyana -- $100 million pledged over ten years to develop national STEM education as part of social responsibility efforts in Guyana.

Need a quote from a Motley Fool analyst? Email pr@fool.com

RISKS

• Darren Woods said, "repair time will be anywhere between three and five years" for the two damaged LNG trains in Qatar, representing about 3% of the company’s global production, which may impact LNG supply and earnings until restoration.
• Middle East conflict and associated supply disruptions continue to pose operational and financial risks, with Woods noting the market "has not seen the full impact" and that further inventory drawdowns could "put upward pressure on prices."
• External events—including drone attacks in Kazakhstan and a Permian winter storm—adversely affected first-quarter Upstream production, highlighting ongoing exposure to geopolitical and weather-related operational disruptions.

SUMMARY

Management confirmed that strategic investments in LNG, refining, and low-carbon solutions are advancing on schedule, with new production and capacity milestones achieved in multiple assets. Leadership stated that proprietary technology is driving efficiency and recovery improvements in major operating basins. A large-scale enterprise technology deployment is underway, expected to deliver additional operational simplification and competitive advantage. Exxon Mobil identified opportunities for further LNG portfolio diversification as new projects move toward sanction. The company reiterated a disciplined capital approach, seeking to maximize returns and minimize earnings volatility amid ongoing global supply disruptions.

• Darren Woods said, "once the Strait opens back up again, a large part of the capacity that is offline today will come back on in a relatively short period of time," but noted damaged infrastructure will require years to restore.
• Refinery maintenance scheduling was tactically adjusted to maximize throughput, as "the organization expedited that maintenance work to get it back online sooner."
• The trading organization’s expansion allowed effective optimization of global flows during supply chain disruptions.
• Darren Woods asserts "any material impacts with respect to Cutter and the insurance portfolio and the damage we have seen there," indicating direct loss coverage is not expected to be a significant constraint.

INDUSTRY GLOSSARY

• FPSO: Floating Production, Storage, and Offloading vessel—used for offshore oil production and processing.
• Cold Box: Specialized equipment in LNG facilities for cryogenic gas separation; key to LNG train function and often with long replacement lead times.
• Turnaround: Planned shutdown of refinery or plant units for maintenance, inspection, and repair.
• Train: In LNG context, a processing unit within an LNG facility; multiple trains increase overall plant capacity.

Full Conference Call Transcript

Darren Woods: Let me begin by recognizing the impact of the conflict in The Middle East on our colleagues and partners in the region. We have been in close contact with our regional partners, as well as with companies and countries we have worked with for many years. We are proud to stand beside them during these very difficult times. While the financial impact in the region is real, what is even more real is the daily threat our colleagues and partners have been living under. We remain committed to supporting them as we work to restore operations and repair assets, with a clear focus on safety and disciplined risk management.

The Middle East is, and will continue to be, an advantaged and meaningful component of our global portfolio. The disruption to the broader economy we are seeing underscores the critical role our company plays in providing the affordable, reliable energy and products the world depends on. What we produce remains essential to development and progress, sustaining and improving living standards around the world. In this environment, scale, integration, and execution excellence matter. Those advantages, combined with the deep experience and capability of our employees, give us the ability to respond quickly and manage effectively through disruptions. Our competitive advantages are on display in this quarter’s results.

We delivered strong operational performance in a challenging environment, maintained rigorous safety and reliability standards, and continued advancing key priorities across the portfolio, supporting long-term value creation for our shareholders. We saw those advantages in our response to supply disruptions, leveraging our global portfolio to support customers. We delivered on our plans to increase Permian production year over year, achieved record levels of production in Guyana, achieved first LNG at Golden Pass, optimized logistics and crude/product flows, and safely maximized refinery throughput where possible.

In fact, in March, refinery throughput increased by approximately 200 thousand barrels per day versus February—the equivalent of a midsized refinery—as we brought back refineries from turnaround and deferred maintenance activities where we could, without impacting safety or long-term reliability. Our global supply chain organization rapidly executed alternate routings from the US Gulf Coast to Asia to sustain critical supplies for our customers. Despite the unprecedented impacts in the global energy system, we maintained deliveries to our customers globally through coordinated planning and real-time vessel visibility. Financially, excluding identified items and estimated timing effects, our first-quarter earnings per share were up versus 2025, reflecting the strength and resiliency of the underlying business.

Stronger portfolio mix, structural cost reductions, and execution excellence continue to drive improving performance. Those same factors leave us better positioned to manage uncertainty versus several years ago. The strength of that advantaged portfolio is clear in the work we are doing today. We are expanding our LNG footprint. Our newest facility, Golden Pass LNG, a joint venture with Cutter Energy, is increasing US export capacity at an important moment for global supply. Train one of the facility achieved first LNG in March and will deliver an increase of about 5% relative to 2025 US exports. By the time the third train is online, we will increase the country’s current LNG exports by roughly 15%.

At the same time, we continue to progress toward final investment decisions on LNG projects in Papua New Guinea and Mozambique, both expected later this year. Elsewhere in the Upstream, Guyana continues to set the standard for execution, development pace, and value creation. We delivered record production, continued strong reliability, and have Oahu, Whiptail, and Hammerhead projects under construction, with Oahu expecting first oil late this year. Consistent with our broader approach to support long-term economic development in countries where we operate, we have committed a $100 million investment over ten years to support national STEM education in Guyana, strengthening our bond with the people of Guyana and establishing a foundation for long-term prosperity.

In the Permian, we continue to show how scale and proprietary technologies improve efficiency, recovery, and long-term value creation. We remain on track to grow full-year Permian production to 1.8 million oil-equivalent barrels in 2026, with that growth grounded in value, not volume. We are also progressing our Permian net-zero ambition, with continuous methane monitoring implemented across all key assets in New Mexico. In Product Solutions, performance remained strong, driven by higher-value products and technology-led differentiation. The Beaumont refinery expansion completed in 2023 fully recovered its initial investment ahead of expectation and is contributing to stronger margins and cash flow. This underscores how disciplined investments, grounded in long-term market fundamentals and rigorously executed, generate durable returns independent of price cycles.

In parallel, we continue to progress our journey to build a reliable domestic supply of advanced synthetic graphite. We recently held a ribbon-cutting ceremony at the pilot production plant in Kentucky, which represents a critical milestone between lab-scale development and full commercial deployment. In Low Carbon Solutions, we began transporting and storing captured CO2 from the New Generation Gas Gathering Project, our second startup in less than a year. Through this year and next, we plan to start facilities with the capacity to capture an additional 4 million tons per year of CO2. Importantly, with our advantages, these projects deliver attractive returns that compete with the investments in our base business.

Technology as a core competitive advantage remains central to our strategy. It is one of the ways we improve structural competitiveness, strengthen returns, and create new earnings opportunity. In Guyana, we achieved the first deepwater fully autonomous well section using rig automation and automated downhole steering tools, improving both safety and efficiency. Additionally, we are on track to leverage our approximate technology in subsea applications with Hammerhead and future FPSOs, further demonstrating the material’s performance in demanding offshore environments. Across the company, we are making further progress to simplify how we run the business through effective application of technology.

Our enterprise-wide process and data platform transformation—the largest ever undertaken in the industry—reached an important milestone with a successful launch of a new modern workforce enablement system. This significantly simplifies the work processes that underpin our talent management approach and streamlines our payroll processes in more than 50 countries. It provides a single, consistent data foundation on which future system deployments will be built. We delivered this with no business disruption, demonstrating the strength of our centralized core capabilities, fully leveraging our scale advantage. This is the first step of many to make our processes more efficient and effective, ultimately enhancing the experience of our global workforce.

This will allow our people to focus their efforts on high-value work, further reinforcing our competitive advantages. Without the changes we made over the last decade and the focus we have put on leveraging our core advantages, this game-changing enterprise system would not be possible. It is establishing a truly differentiating foundation for long-term competitive advantage. With recent events, the world has been reminded of the critical role and long-term need for reliable, affordable energy products. Today, more people recognize that demand for oil and natural gas remains substantial and will continue to play an important role in global economic growth far into the future.

This fundamental and the competitive advantages we bring underpin our strategy, our capital allocation decisions, and the long-term success of our company. We are confident in our advantages, the importance of scale and integration, the critical role of technology and execution excellence, and the power of talented people. We are confident in our continuing transformation and the critical role our company will play in any future scenario. And we are confident in our plan to build long-term, sustainable earnings and cash flow growth—the basis for long-term growth and shareholder value. Thank you.

Jim Chapman: Thank you, Darren. Before we move to Q&A, I want to highlight that we plan to publish our 2026 Advancing Climate Solutions report this month, detailing all of our progress on solving the “and” equation—meeting demand and reducing emissions—as well as our latest sustainability report. All these documents can be found on the Investors section of our website. We really encourage you to take a look. We will now open the call for questions. Please note that we ask each analyst to limit themselves to one question as a courtesy to others. Operator, please open the line for our first question. Thank you.

Operator: Question and answer session will be conducted electronically. If you would like to ask a question, please do so by pressing the star. The first question comes from Devin McDermott of Morgan Stanley.

Devin McDermott: Good morning. Thanks for taking my question. Darren, I wanted to try to unpack some of your views on the near- and longer-term impacts from the situation in The Middle East. On the near-term side, I was hoping you could talk through your view on the timeline for operations in the region, including your own, to return to normal once the Strait reopens. And then, shifting to the medium and longer term, I would love to hear your perspective on how lasting you expect the market impacts to be across upstream, refining, chemicals, and whether you are seeing anything that structurally changes your view of normalized or mid-cycle prices and margins.

Darren Woods: Sure. Thank you, Devin. Maybe to start, let me just provide some context around how we are looking at what has been playing out here in the market, which will form the foundation for how we see it continuing to play out. I think it is obvious to most that if you look at the unprecedented disruption in the world supply of oil and natural gas, the market has not seen the full impact of that yet. You only have to look at the ranges that oil prices have moved at, which are very consistent with the last ten years in the history, versus this historically unprecedented disruption. So there is more to come if the Strait remains closed.

Why have we not seen those impacts manifest themselves fully in the market yet? Well, there was a lot of oil in transit on the water, a lot of inventory on the water, that has been deployed in the first month of conflict. Strategic petroleum reserves have been released. Commercial inventories have been drawn down. We have seen that play itself off and mitigate the impact as we moved through March and then here through April.

As you get to the minimum working levels of inventory on the commercial side, you are going to lose one of these sources of supply, and we anticipate, as that happens and the Strait remains closed, that we will continue to see increased prices in the marketplace. Once the Strait opens back up again, it will take some time to get back to a stable flow rate that was consistent with what we have historically seen. Ships have to reposition themselves. We have to work through the backlog. Then there is obviously the transit time to get the product to market.

We are thinking there is going to be a one- to two-month time lag between the Strait opening up and the market seeing normal flow. Depending on how long this goes and how far strategic petroleum reserves are drawn and how low commercial inventories go, there will be a period of time where players, markets, governments, and countries try to refill and replenish those inventories. That is going to bring an additional level of demand into the marketplace, which we think will put upward pressure on prices. I would also add that many countries around the world will look at, if they do not have strategic petroleum reserves, whether they need those.

That may bring some additional demand into the marketplace. People are going to reassess their energy security and how they ensure that, going forward, they do not have the same exposure that many of them have realized here in the short term. All those things are difficult to predict exactly, but I do think they will have an impact on prices, basically manifesting as maybe higher demand than we anticipated at the beginning of this year. The final point I would make with respect to longer-term implications is that it depends on where Iran ends up, and how comfortable the world is—what assurances they have—that the flows will remain uninterrupted.

Whether or not a risk premium is put into the market is a question that is yet to be answered. With respect to our own facilities, we were, first and foremost, as this conflict erupted, very focused on protecting our people and making sure that we kept them safe, which I am very pleased with how our organization responded to. As the conflict has gone on and we have done our risk assessments, we have allowed more folks to return to help with our partners and assess the damage. I think once the Strait opens back up again, a large part of the capacity that is offline today will come back on in a relatively short period of time.

We will have to cool down the LNG trains to get that moving again. That will take a few weeks, but I think we will see that supply ramp up fairly quickly. Ultimately, we will have to work with Cutter Energy on the two trains that were damaged. That will be a much longer time horizon with respect to repair. That will be about 3% of our global production, and Cutter Energy came out very early on and said the repair time will be anywhere between three and five years.

Obviously, we are working to be on the low end of that range, but we have more work to do to fully assess the damage and understand what options we have for repair. Neil, anything to add to that?

Kathy Mikells: Yes. Hey, Devin. Maybe another perspective on the near term. Obviously, we have been focused on the external impacts to our Upstream production—certainly what we have seen in The Middle East—but we also had some other external impacts in the quarter: some impacts in Kazakhstan from drone attacks, and it seems like it has been a while, but there was also a fairly significant impact from the winter storm in the Permian back in January. If you exclude all those external impacts, it really highlights the benefit and the value of having a global, diverse portfolio. If we take those impacts out, year over year our Upstream production was up 8%.

That 8% again comes from advantaged assets in the Permian and in Guyana—organic advantaged assets. It just highlights that, yes, there is a lot of disruption, but having those advantaged assets and that global, diverse portfolio allows us to continue to deliver long-term shareholder value.

Devin McDermott: Appreciate all the thoughts. Thanks, guys.

Operator: The next question is from Bob Brackett of Bernstein Research.

Bob Brackett: Good morning. I am drawn to your exhibit five where you show March 2026 refining margins. Obviously, it is not a full quarter; it is a single month. Can you talk to that opportunity, maybe inform us how April turned out, and then talk about how you can help balance that market and what are the opportunities for you in the downstream this year? Going forward.

Darren Woods: Thank you, Bob. Good morning. I would just start by saying one of the advantages we find here in this market, with the pressure on supply and the resulting increase in refining margins, is we are very satisfied that we never lost focus on making sure that we were building a very robust and advantaged refining network. You will recall, we started up a very large expansion at our Beaumont refinery in 2023. When we first announced that investment in refining, there were a lot of questions about whether that was going to play itself out and be a profitable investment. We have now paid that investment off completely.

That is an example of how we never doubted that having an advantaged footprint in refining, one that has a diversified product slate, is going to be critical as we move forward to meet the world’s demand. We feel really good about where we are. We have had several investments in high-grading the production of refining, and today we have a very strong circuit to meet the demand that is in the marketplace today. If you look at our Gulf Coast refineries, which is the largest footprint we have, they ran in the first quarter at record utilization rates. We have been very focused on reliability and making sure that the facilities we have are running at peak production.

We emphasized that as we moved into March and saw this disruption coming. We worked it through the refining circuit for units that were in turnarounds; the organization expedited that maintenance work to get it back online sooner. For units that we were planning to take down for additional maintenance, we did assessments to see if we could safely defer those. We really worked hard to try to respond to the demand that was out there, and from February to March, we increased refining production by 200 thousand barrels per day. That is just an example of how we were leaning on the organization to meet the moment.

On top of that, our supply organization has done a tremendous job at moving barrels all around the world to rebalance the supply we have with the demand shortages that we see developing across the world. All that continues, and I think that is going to play out very well for us as we move through April and into the second quarter. I am extremely pleased that the work we have historically done over the last ten years to reshape the organization—this was a real test of the changes that we have made—has proven itself to be extremely effective with respect to our ability to bring the most critical resources and our best talent on some of the hardest problems.

Thankfully, we had built our trading organization up to help facilitate these movements, and all that in combination has led to what was a very successful month of March, not just from an earnings standpoint, but from the ability to meet the moment and meet the demand. That is going to continue to play itself out.

Kathy Mikells: And Bob, just to give some context, we had some temporary, transient impacts in our financial results this quarter with the timing impacts that we disclosed in the identified items. But if you set those aside and look at the Energy Products segment, we made $2.8 billion in the quarter, up $2 billion compared to last year, and a few hundred million dollars compared to the fourth quarter. For all the reasons that Darren talked about—leveraging those world-class assets that we brought online last year and leveraging our trading capability—we have been able to deliver to the bottom line in the market environment that we saw in March.

Bob Brackett: Very clear. Thanks.

Jim Chapman: Thank you, Bob.

Operator: The next question is from Arun Jayaram of JPMorgan.

Arun Jayaram: Good morning. Thanks for taking my question. I wanted to see if you could elaborate on how you view some of the resource expansion opportunities in Guyana, as well as your initial assessment of the situation in Venezuela.

Darren Woods: Yes, sure. Thanks for the question. I will start with the latter. If you look at Venezuela, obviously Venezuela is a huge resource that is now opened up more freely to the world. There is continuing work going on with the industry, with the Trump administration, and with the government of Venezuela to get the context of that opportunity shaped so that it represents attractive investment opportunities for the industry and generates the necessary returns to make the investments in Venezuela. The oil in Venezuela is very heavy and therefore requires a lot of effort to get production up and get it onto the market.

Doing that in a way that is low cost is going to be absolutely critical for Venezuelan oil to fully contribute to the world balances and to meet the demand that is out there. I would tell you the work that we have been doing, really anchored in our resource up in Canada and the work on heavy oil technology developments we have been making, I think positions us uniquely in terms of low-cost production of the Venezuela resources when that opportunity, when the context is right, and the investment and the returns look promising. I feel positive about what is happening there.

There is more work to do, but I think we will be uniquely positioned and play an important role in bringing those barrels to market. More broadly, looking at the resource opportunity, Guyana continues—we continue—to demonstrate outstanding progress. We were again at record production and, given the investment basis that we had as we brought those projects online, I would say it is a testament to the innovation and ingenuity of the team working that resource and their motivation to continue to find ways to improve and get better. That mentality applies broadly across the team.

The team is very engaged in developing the resources across the block, very focused on developing projects that generate the returns across the entire resource base. I think we are going to continue to see projects come online and opportunities present themselves as we continue to develop that resource. There is still a lot of acreage left to be assessed, and I think the opportunity there is significant. As we look at the area as a whole, beyond Venezuela, you have the work that we are doing with Trinidad and Tobago, and I think we are going to see some opportunities there as well with time. Thank you.

Jim Chapman: The next question is from Neil Mehta of Goldman Sachs.

Neil Mehta: Thank you, Darren and team. I would love your perspective on the Permian. You have been very clear about this being a growth engine—guiding to 1.8 million barrels a day and eventually getting to 2.5 million barrels a day. In light of the higher commodity price and the need for US barrels, do you expect the Permian to have an activity response from an industry perspective? Does this change the way that you are prosecuting the basin in any way? And then I know you have had a lot of conversations with the administration. We are getting a lot of questions about the crude export ban and any risks around that. Do you feel comfortable around that policy? Thank you.

Darren Woods: Yes. Thank you, Neil. First, with respect to what we have been doing in the Permian, I think you all know we have had pedal to the metal from the very beginning. We recognize the importance of that resource in meeting world demand and, in particular, in establishing the US as the preeminent player and supplier in this market. We have been very focused on that from the very beginning. You can see that in the growth rate that we have achieved in that resource, obviously focused on doing it in a very capital-efficient way and ensuring a very low cost of supply. The work that we have been doing on the technology portfolio is showing a lot of promise.

It is hard to see in the data today because we are in the early stages of deployment, but I would say we remain very optimistic that we are going to continue to see capital-efficiency opportunities and recovery opportunities manifest themselves through the deployment of technology. We are going to continue on the pace that we have been at. We are running pretty full speed, unlike many of our competitors who have predicted the plateauing of the resource and the opportunities out there. We have never seen that, and we do not see it today. Whether views in the industry change, I cannot comment on whether they intend to run through their inventory more quickly.

Ultimately, the opportunity here is to do things in a more effective way to maximize the recovery of the barrels, and that is what we are very focused on. With respect to crude export bans, I have been very encouraged by the comments made by Secretary Wright and the recognition that something like that would be hugely detrimental to the industry and the supply. It is important for politicians to understand that countries and companies export product when they do not have the demand domestically. Your most profitable barrels are the barrels that you supply to your local market because transportation cost is the lowest. Everyone looks to that tier first.

It is only when you have satisfied the demand of your local markets that you start sending your product and barrels farther afield and incurring the transportation cost. That is what is driving the exports. The world is in price parity, and the market and the prices around the world all reflect a consistent price basis. It really comes down to what are your local opportunities, and when you run through those, you export. If you shut in exports, you shut in production. It is particularly impactful in the US that if you shut that production in, you shut in the associated gas that comes with it.

A huge benefit to the US economy to date has been low-cost, low-price natural gas, which feeds our industrial complex and manufacturing complex. It leads to the economic growth we have been enjoying in the country, leads to job creation and expansions. There are a lot of negative implications if we see that happen. I am extremely pleased that the administration recognizes that and is not looking to that as a lever to pull, unlike other countries as you move around the world that have started talking and looking at things like that. They are going to cause a bigger problem for themselves in pursuing what feels like populist action in the short term that has very negative long-term consequences.

Neil Mehta: Thanks.

Darren Woods: You bet.

Operator: Next question is from Betty Jiang of Barclays.

Betty Jiang: I want to ask about LNG. Starting with whether today’s disruptions have changed your long-term view on the LNG macro and, given the tightening supply today, whether there is any flexibility to lean in on Golden Pass with the first train that is currently on—whether there is ability to increase that utilization and maybe accelerate the timing of future trains. Maybe just an update on the timing on the next two LNG projects as well.

Darren Woods: Thank you for the question, Betty, and good morning. If I reflect on the discussions I have had with all of you over the last year or so, there has been this prediction out there that the LNG market is going long. A lot of our LNG is tied to crude contracts, and so the supply-demand balances and the impact on pricing in the LNG market are a little different than what we have in the crude markets. We were always constructive on LNG going forward.

What we see now, with the impacts from what has come offline and some of the damaged facilities, is that the length people were talking about over the last year has gone away, and I think we are going to see a tighter market here, certainly in the short to medium term. That is helpful in the short term, but as you know, we do not make investment decisions based on calling a specific supply-demand balance and price environment. We tend instead to focus on making sure that the capacity we bring on is advantaged—it is low cost and will be successful irrespective of the price environment.

Golden Pass is obviously one of those assets; Mozambique and Papua New Guinea are as well. All those are projects that we are developing with a long-term view and have been progressing as expeditiously as we can, consistent with capital discipline and efficient project development. We will look for opportunities in the short term and with our production to see if there is more that we can bring on, but I do not see a needle-moving opportunity simply because, in the base case, we were pushing hard to do it in an efficient and expeditious manner as possible. With respect to Golden Pass, as you know, we have Train one on and getting product to market.

Train two we expect to be mechanically complete by the end of this year, and Train three should be mechanically complete as we head into the second quarter of next year.

Betty Jiang: Great. Thank you.

Operator: Next question is from Doug Leggate of Wolfe Research.

Doug Leggate: Good morning, everyone. Thank you for taking my question. Darren, I wonder if I could come back—maybe it is for Neil—back to Qatar. You have quantified the volumetric impact, the LNG impact. But my question is, your participation in the repairs comes up against, I believe, limited remaining contract length in the two trains you are involved in. How does force majeure impact that decision? Do you get the contract extended? Maybe you could walk us through the implications of that. Thanks.

Darren Woods: Thanks, Doug. I would just say that the long history we have in Cutter and the partnership we have with Cutter Energy is extremely strong and as strong as it has ever been. We are extremely committed to working with Cutter Energy and helping restore the supply to the marketplace. Having said that, we will do that in a construct that ensures that we generate return on the capital and the money that we put back into that business. I am not going to get into the specifics of how that will play out, but Cutter Energy has always recognized that successful partnerships require win-win solutions and opportunities.

That has been a real strength of Cutter Energy and the work that they have done in the industry. It underpins the work that we do with them. They understand and respect the value and the contribution that we can bring in our partnership, and they recognize the importance of being rewarded for those contributions. I know in the discussions I will have with Saad and the rest of the leadership of Cutter Energy that will continue to be respected. We will find a way to do that in a way that is good for Cutter Energy, good for Exxon Mobil Corporation, and frankly good for the world in terms of bringing that low-cost supply back into the marketplace.

Doug Leggate: That is very clear. Thanks, Darren. Appreciate it.

Operator: The next question is from Biraj Borkhataria of RBC Capital.

Biraj Borkhataria: Hi. Thanks for taking my question. It is a follow-up on your LNG portfolio. You talked at the start of the call about countries thinking about their level of exposure to the region, and when I look at the rest of your business, it is fairly diversified. But I look at your LNG portfolio relative to peers and it is obviously much more concentrated, with Qatar being such a big part of that. Do recent events make you think about wanting to diversify much more rapidly? I know you are doing a few things outside of that now, but how are you thinking about it over the longer term? Thank you.

Darren Woods: Thank you, Biraj. I would just tell you that we have always believed, and I think you all will recognize, that we have consistently viewed LNG as a business that is going to be critical for meeting the long-term energy demands of the world far into the future. We have always been bullish on the natural gas and LNG markets. What has dictated what we pursue and the investments we go after is the quality of the opportunities and the returns that we can generate. It has not been constrained by anything other than that. This disruption does not change the opportunity set that we have been working on or the emphasis that we have had in that area.

If you look at the things in the pipeline that we are pursuing—Mozambique and Papua New Guinea and continuing to bring on the rest of Golden Pass—those are all growing our LNG portfolio, which has been a strategic objective. It is also diversified with respect to sources of supply, which I think was important in establishing a global network of supply points. That is playing itself out as we speak today. If additional opportunities develop in the short term that we feel we can bring advantage to and generate an advantaged project with advantaged returns—with low cost of supply, competitively positioned in the world supply portfolio—we will pursue those.

But my going-in assumption is that those opportunities were already out there and we have been actively pursuing them. I do not think that will change with what we have seen, certainly in the short term; we will see what happens longer term. Our emphasis remains constant here.

Biraj Borkhataria: Okay. Understood. Thank you.

Operator: The next question is from Jason Gabelman of TD Cowen.

Jason Gabelman: I just wanted to first clarify one point, going back to Doug’s question. Are you self-insured in Qatar like you are on most of your assets, or do you have insurance on that? And then I was hoping you could talk about the opportunity that is potentially available in the UAE if they were to ramp up production towards that 5 million barrels per day when the Strait of Hormuz reopens. You obviously have a very large footprint in that country, and I am wondering if there is spare capacity on your assets. Thanks.

Darren Woods: Thanks for the question. I will not get into the specifics of our insurance. You are right that we have a position where we use a large portion of self-insurance. We also look at third-party insurance where we think it makes economic sense. We take a portfolio approach there. We feel pretty good about the coverage across that portfolio and, frankly, do not see any material impacts with respect to Cutter and the insurance portfolio and the damage we have seen there. With respect to the UAE, the UAE is a strategic partner for us as well. We have a very long relationship there.

We have worked very productively with ADNOC in establishing an opportunity set to take some of our capability sets and advantages and bring them to bear in terms of unlocking additional capacity in the UAE, and we are working towards that ambition. We have a very good relationship with them, very good commercial arrangements, and we are actively working to help the UAE grow its immediate ambitions of growing production. We will be a part of that, I am sure of it. We already are, and we are obviously looking for opportunities to do more.

Jason Gabelman: Thanks.

Operator: The next question is from Manav Gupta of UBS.

Manav Gupta: Thank you for taking my question. You are an expert in developing heavy oil—obviously you talked about Venezuela. One area where you kind of stopped growing is Canada. Given everything that is going on in the world and the short supplies, is there a way you and your partner can move that proprietary technology at a faster pace and bring back Aspen or future phases of Canada? When you delayed those projects, there was an egress issue and other issues. Those issues are resolved, so I am wondering if you can restart growth in Canada also.

Darren Woods: Thank you. I think you touched on a really important part of the portfolio and the advantages that we have in heavy oil. The emphasis that we have had over the last several years, working with IOL, is to really drive performance improvement in our Kearl assets and make sure that, as you look at the global supply curve and the cost in the portfolio around the world that meets that supply, our Kearl resource is attractively positioned in that supply curve. The team through IOL and the work in that venture have driven improvement to the point where we see that as being a very competitive source of supply in the world market.

That is a function of a lot of things we have been working on. Technology is certainly a huge piece of that, but also the practices that we bring through our operations organization and the work we have done to bring things we have learned through our manufacturing assets into that upstream-dominated environment. We have seen huge benefits and a lot lower cost. Today, it is a very productive resource, and we continue to make investments. We see that being a long-term profitable part of our portfolio. Likewise, in the in-situ Cold Lake, we have technical opportunities there and we are progressing those.

That is recognized with the technology work that we have done: we have lowered the cost of supply to the point that we think it represents a very attractive opportunity and a low cost of supply. We are continuing to progress that. That is what anchored my comments with respect to Venezuela. I think we are uniquely positioned in terms of the global footprint that we have and the ability to go into Venezuela with the right set of circumstances to apply that technology and produce those barrels at a much lower cost of supply than many of our competitors would be capable of doing.

We look forward to exploring that opportunity and seeing if we can flush that out to a point where it becomes a win-win-win opportunity: a win for Exxon Mobil Corporation with respect to the returns for the capital and the assurances we would have with those returns, a win for the government of Venezuela, and a win for the Venezuelan people with the economic activity that would obviously come with that.

Manav Gupta: Thank you.

Operator: The next question is from Alastair Syme of Citi.

Alastair Syme: Good morning. I wonder if I can come back to that slide five. You obviously had chemical margins squeezed in March, but I am wondering if there has been any recovery in April back to those ten-year averages, and how you see your feedstock availability. I think you referenced potential for the Product Solutions business to have 3% lower utilization this quarter, but I am wondering how specifically that shakes out for the chemical products piece. Thank you.

Darren Woods: Sure. Thank you. The first point I would make on that slide five is we are representing margins there to help you understand what the macro environment is with respect to the quarter and the circumstances that we were operating in. It does not reflect our footprint specifically. I would say that we are advantaged versus where the general market is, primarily because of all the work that we have been doing to grow performance products and to improve the efficiency and lower the cost of our manufacturing facilities. On top of that, we have a very large base here in the US.

As crude prices have risen—and our US footprint is primarily gas crackers—what you see is the world price being set on liquid crackers, and we have a big feed advantage. The expectation, if oil prices remain elevated, is that chemical margins for a large part of our footprint will be advantaged simply because we have a feed advantage coming out of the US.

Kathy Mikells: I would just highlight that the North American advantage extends to our refining footprint as well. Again, the slide is a view of a global footprint, but we are more heavily weighted to North America and again benefit from that low-cost energy supply we have here in North America.

Alastair Syme: Thank you. Appreciate it.

Operator: The next question is from Jean Ann Salisbury of Bank of America.

Jean Ann Salisbury: Hi, good morning. For the damaged trains in Qatar, can you give any more color about what drives the three- versus five-year timing to get those back online? I have read that there is a two- to three-year lead time for new cold boxes. Is that right—that is the primary factor? And are there options to speed that up?

Darren Woods: Thank you, Jean Ann. The range is a function of where we are at in the process of working with Cutter Energy and assessing the damage, then working out a plan to address the damage, recognizing the conflict is ongoing. We have been very aligned, and I would say Cutter Energy has been a real leader in making sure that we are very judicious in the steps we are taking and the deployment of people to make sure that we maintain a level of protection and the safety of our people working there.

Part of the challenge in the early numbers is the unknown variables we are working through with Cutter Energy around what exactly our options are and what we can do. It is a function of where we are at and the maturity of the work we have done to date in terms of assessing what we can do. On your point around the cold box being a critical path—thinking of it in those terms is accurate. I would just say I have not accepted any specific schedule because we have not been able to do all the work we need to do to challenge ourselves and see what is possible here.

What I would say is I have a lot of confidence that the partnership and the work that we do with Cutter Energy, and the capability we bring to this repair, will be unmatched. Whatever we end up doing here and whatever timeline we set, I do not think there would be anybody else who could beat it. I feel very confident in the capability set that we are bringing to bear, and we have to work through the details to see what the ultimate answer is, but whatever it is, I think it will be the best that could be done by anybody in the industry.

Jean Ann Salisbury: Very clear. Thank you.

Operator: The next question is from Sam Margolin of Wells Fargo.

Sam Margolin: Hi, good morning. Thanks so much. This question might be for Neil. It is related to the timing effects. I know it is a short-term issue, but your long-term targets have been very consistent, so maybe that is where the focus is for right now. They encompass a lot of different aspects of the business, and when they reverse, it also involves a lot of different moving parts.

Insofar as some of the reversal of the timing effects is related to execution wins within the business—and there are prospects for volatility events to continue throughout this period of uncertainty—were there any learnings or changes in your operating practices made as an adjustment to this event that would help you reverse the timing effects faster, or do you expect it to just pass as they have done in the past? Thank you.

Darren Woods: Let me start with that and then hand it over to Neil. I just want to make sure the basis of the timing or the underlying activity of the timing is understood, because what this basically is—you all remember that we have set up this trading organization and have been growing it over the years, with the primary objective to take advantage of our large footprint, the fact that we are an integrated business and involved in many parts of the value chain, and to make sure that we see trading as a channel to optimize that footprint that we think is a real advantage versus anybody else that is out there trading.

We have done that in a very methodical way and in a way that we feel manages the exposure and the risk, and I am extremely proud.

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. Parts of this article were created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.