ExxonMobil Obtains Exemption from Canadian Oil and Gas Reporting Obligations

Rhea-AI Summary

Exxon Mobil Corporation (XOM) has received exemptive relief from disclosure requirements in Alberta and Ontario, allowing it to provide oil and gas activity disclosure under U.S. Rules instead of NI 51-101.

Insights

Energy Sector Analyst

The exemptive relief granted to ExxonMobil by the securities commissions of Alberta and Ontario represents a significant regulatory development. It allows the company to streamline its disclosure requirements by aligning with the U.S. standards rather than the Canadian National Instrument 51-101. This decision could potentially reduce administrative burdens and costs associated with regulatory compliance for ExxonMobil. However, investors should be aware that the U.S. Rules and NI 51-101 differ in disclosure requirements, which may affect the transparency and comparability of ExxonMobil's oil and gas reporting.

For stakeholders, this implies a need to adapt to new reporting standards that may not provide the same level of detail as the Canadian requirements. The long-term implications could include a shift in investor perception and confidence, depending on the perceived adequacy of the U.S. disclosure framework. The market's reaction to this regulatory change could be contingent upon whether investors view the U.S. Rules as sufficiently rigorous.

Securities Regulation Expert

The decision to exempt ExxonMobil from NI 51-101 requirements highlights the differences between Canadian and U.S. securities regulations. The U.S. disclosure regime is governed by the SEC, which has its own set of rules and standards for reporting. The primary concern for analysts and investors will be to understand how the exemption might alter the depth and quality of information provided by ExxonMobil. It is crucial to consider that the U.S. Rules may not require the same level of granular data on reserves and other oil and gas information that NI 51-101 mandates.

From a regulatory perspective, this exemption could set a precedent for other multinational companies seeking similar relief in Canada. The challenge for regulators will be to ensure that the integrity of the market is maintained and that investors have access to consistent and reliable information across different jurisdictions.

Investor Relations Specialist

For ExxonMobil, the Decision may be viewed as an opportunity to harmonize its reporting practices across different regulatory environments, potentially leading to greater operational efficiency. However, it is incumbent upon the company's investor relations team to ensure that stakeholders are fully informed about the implications of the change in disclosure standards. Effective communication will be key in maintaining trust and investor confidence.

Investors should closely monitor the company's future filings to assess the impact of the new reporting format on ExxonMobil's transparency and the quality of disclosed information. The investor relations team will need to provide clear guidance on interpreting the new disclosures in line with the U.S. Rules and address any concerns arising from the differences between the two disclosure regimes.

SPRING, Texas--(BUSINESS WIRE)-- Exxon Mobil Corporation (NYSE: XOM) announced today that the securities commissions for the provinces of Alberta and Ontario have issued a decision document (the Decision), which has the effect of granting ExxonMobil exemptive relief from the disclosure requirements contained in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (NI 51-101).

As a result of the Decision, and provided that certain conditions set out in the Decision are met on an on-going basis, ExxonMobil will not be required to comply with the requirements of NI 51-101 and, accordingly, will not be required to file Form 51-101F1 – Statement of Reserves Data and Other Oil and Gas Information, Form 51-101F2 – Report on Reserves Data by Independent Qualified Reserves Evaluator or Auditor and Form 51-101F3 – Report of Management and Directors on Oil and Gas Disclosure. In lieu of such filings, ExxonMobil is permitted, pursuant to the Decision, to provide disclosure in respect of its oil and gas activities in the form permitted by, and in accordance with, the legal requirements of the United States Securities and Exchange Commission, the United States Securities Act 1933, as amended, the United States Securities Exchange Act of 1934, as amended, the United States Sarbanes-Oxley Act of 2002 and the rules of the New York Stock Exchange (collectively, the U.S. Rules). ExxonMobil is required to file such disclosure with the securities regulatory authority or regulator in each of the provinces of Canada as soon as practicable after such disclosure is filed pursuant to the U.S. Rules.

Readers should be aware that ExxonMobil’s future disclosure relating to its oil and gas activities will comply with the U.S. Rules rather than NI 51-101 and the Canadian Oil and Gas Evaluation Handbook. The U.S. Rules differ in a number of respects from the disclosure otherwise required under NI 51-101 and the Canadian Oil and Gas Evaluation Handbook and readers are urged to consider these differences when considering all future disclosures made by ExxonMobil relating to its oil and gas activities.

About ExxonMobil

ExxonMobil, one of the largest publicly traded international energy and petrochemical companies, creates solutions that improve quality of life and meet society’s evolving needs.

ExxonMobil’s primary businesses - Upstream, Product Solutions and Low Carbon Solutions – provide products that enable modern life, including energy, chemicals, lubricants, and lower emissions technologies. ExxonMobil holds an industry-leading portfolio of resources, and is one of the largest integrated fuels, lubricants, and chemical companies in the world. In 2021, ExxonMobil announced Scope 1 and 2 greenhouse gas emission-reduction plans for 2030 for operated assets, compared to 2016 levels. The plans are to achieve a 20-30% reduction in corporate-wide greenhouse gas intensity; a 40-50% reduction in greenhouse gas intensity of upstream operations; a 70-80% reduction in corporate-wide methane intensity; and a 60-70% reduction in corporate-wide flaring intensity.

With advancements in technology and the support of clear and consistent government policies, ExxonMobil aims to achieve net-zero Scope 1 and 2 greenhouse gas emissions from its operated assets by 2050. To learn more, visit exxonmobil.com and ExxonMobil’s Advancing Climate Solutions.

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ExxonMobil Media Relations

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Source: Exxon Mobil Corporation

FAQ

What decision document was issued by the securities commissions for the provinces of Alberta and Ontario?

The securities commissions issued a decision document granting ExxonMobil exemptive relief from the disclosure requirements in NI 51-101.

What forms will ExxonMobil not be required to file as a result of the Decision?

ExxonMobil will not be required to file Form 51-101F1, Form 51-101F2, and Form 51-101F3.

Under what conditions will ExxonMobil not be required to comply with the requirements of NI 51-101?

ExxonMobil will not be required to comply with NI 51-101 if certain conditions set out in the Decision are met on an ongoing basis.

What legal requirements will ExxonMobil follow for its oil and gas activity disclosure?

ExxonMobil will provide disclosure in accordance with the U.S. Rules, including the requirements of the United States Securities and Exchange Commission.

What should readers consider about ExxonMobil's future disclosure regarding its oil and gas activities?

Readers should note that future disclosures by ExxonMobil will comply with the U.S. Rules rather than NI 51-101 and the Canadian Oil and Gas Evaluation Handbook.