imo-20230630

FALSE2023Q2000004993812/31



(a) Amounts from related parties included in revenues.	3,556	5,175	6,692	9,134



(b) Amounts to related parties included in purchases of crude oil and products.	964	1,129	2,042	1,779



(c) Amounts to related parties included in production and manufacturing, and selling and general expenses.	125	116	260	234



(d) Amounts to related parties included in financing.	41	13	80	17



(c) Included contributions to registered pension plans.	(44)	(46)	(86)	(96)

http://fasb.org/us-gaap/2023#LongTermDebtAndCapitalLeaseObligationshttp://fasb.org/us-gaap/2023#LongTermDebtAndCapitalLeaseObligations00000499382023-01-012023-06-3000000499382023-06-30xbrli:shares00000499382023-04-012023-06-30iso4217:CAD00000499382022-04-012022-06-3000000499382022-01-012022-06-30iso4217:CADxbrli:shares0000049938us-gaap:RelatedPartyMember2023-04-012023-06-300000049938us-gaap:RelatedPartyMember2022-04-012022-06-300000049938us-gaap:RelatedPartyMember2023-01-012023-06-300000049938us-gaap:RelatedPartyMember2022-01-012022-06-3000000499382022-12-310000049938us-gaap:RelatedPartyMember2023-06-300000049938us-gaap:RelatedPartyMember2022-12-310000049938us-gaap:CommonStockMember2023-03-310000049938us-gaap:CommonStockMember2022-03-310000049938us-gaap:CommonStockMember2022-12-310000049938us-gaap:CommonStockMember2021-12-310000049938us-gaap:CommonStockMember2023-04-012023-06-300000049938us-gaap:CommonStockMember2022-04-012022-06-300000049938us-gaap:CommonStockMember2023-01-012023-06-300000049938us-gaap:CommonStockMember2022-01-012022-06-300000049938us-gaap:CommonStockMember2023-06-300000049938us-gaap:CommonStockMember2022-06-300000049938us-gaap:RetainedEarningsMember2023-03-310000049938us-gaap:RetainedEarningsMember2022-03-310000049938us-gaap:RetainedEarningsMember2022-12-310000049938us-gaap:RetainedEarningsMember2021-12-310000049938us-gaap:RetainedEarningsMember2023-04-012023-06-300000049938us-gaap:RetainedEarningsMember2022-04-012022-06-300000049938us-gaap:RetainedEarningsMember2023-01-012023-06-300000049938us-gaap:RetainedEarningsMember2022-01-012022-06-300000049938us-gaap:RetainedEarningsMember2023-06-300000049938us-gaap:RetainedEarningsMember2022-06-300000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-310000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-310000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-04-012023-06-300000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-04-012022-06-300000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-01-012023-06-300000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-06-300000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-06-300000049938us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-06-3000000499382022-06-3000000499382023-03-3100000499382022-03-3100000499382021-12-310000049938imo:XtoEnergyCanadaMember2022-04-012022-06-300000049938imo:XtoEnergyCanadaMember2022-01-012022-06-300000049938imo:UpstreamMember2023-04-012023-06-300000049938imo:UpstreamMember2022-04-012022-06-300000049938imo:DownstreamMember2023-04-012023-06-300000049938imo:DownstreamMember2022-04-012022-06-300000049938imo:ChemicalMember2023-04-012023-06-300000049938imo:ChemicalMember2022-04-012022-06-300000049938us-gaap:IntersegmentEliminationMemberimo:UpstreamMember2023-04-012023-06-300000049938us-gaap:IntersegmentEliminationMemberimo:UpstreamMember2022-04-012022-06-300000049938us-gaap:IntersegmentEliminationMemberimo:DownstreamMember2023-04-012023-06-300000049938us-gaap:IntersegmentEliminationMemberimo:DownstreamMember2022-04-012022-06-300000049938us-gaap:IntersegmentEliminationMemberimo:ChemicalMember2023-04-012023-06-300000049938us-gaap:IntersegmentEliminationMemberimo:ChemicalMember2022-04-012022-06-300000049938us-gaap:OperatingSegmentsMemberimo:UpstreamMember2023-04-012023-06-300000049938us-gaap:OperatingSegmentsMemberimo:UpstreamMember2022-04-012022-06-300000049938us-gaap:OperatingSegmentsMemberimo:DownstreamMember2023-04-012023-06-300000049938us-gaap:OperatingSegmentsMemberimo:DownstreamMember2022-04-012022-06-300000049938us-gaap:OperatingSegmentsMemberimo:ChemicalMember2023-04-012023-06-300000049938us-gaap:OperatingSegmentsMemberimo:ChemicalMember2022-04-012022-06-300000049938us-gaap:CorporateNonSegmentMember2023-04-012023-06-300000049938us-gaap:CorporateNonSegmentMember2022-04-012022-06-300000049938srt:ConsolidationEliminationsMember2023-04-012023-06-300000049938srt:ConsolidationEliminationsMember2022-04-012022-06-300000049938country:US2023-04-012023-06-300000049938country:US2022-04-012022-06-300000049938imo:UpstreamMember2023-01-012023-06-300000049938imo:UpstreamMember2022-01-012022-06-300000049938imo:DownstreamMember2023-01-012023-06-300000049938imo:DownstreamMember2022-01-012022-06-300000049938imo:ChemicalMember2023-01-012023-06-300000049938imo:ChemicalMember2022-01-012022-06-300000049938us-gaap:IntersegmentEliminationMemberimo:UpstreamMember2023-01-012023-06-300000049938us-gaap:IntersegmentEliminationMemberimo:UpstreamMember2022-01-012022-06-300000049938us-gaap:IntersegmentEliminationMemberimo:DownstreamMember2023-01-012023-06-300000049938us-gaap:IntersegmentEliminationMemberimo:DownstreamMember2022-01-012022-06-300000049938us-gaap:IntersegmentEliminationMemberimo:ChemicalMember2023-01-012023-06-300000049938us-gaap:IntersegmentEliminationMemberimo:ChemicalMember2022-01-012022-06-300000049938us-gaap:OperatingSegmentsMemberimo:UpstreamMember2023-01-012023-06-300000049938us-gaap:OperatingSegmentsMemberimo:UpstreamMember2022-01-012022-06-300000049938us-gaap:OperatingSegmentsMemberimo:DownstreamMember2023-01-012023-06-300000049938us-gaap:OperatingSegmentsMemberimo:DownstreamMember2022-01-012022-06-300000049938us-gaap:OperatingSegmentsMemberimo:ChemicalMember2023-01-012023-06-300000049938us-gaap:OperatingSegmentsMemberimo:ChemicalMember2022-01-012022-06-300000049938imo:UpstreamMember2023-06-300000049938imo:UpstreamMember2022-06-300000049938imo:DownstreamMember2023-06-300000049938imo:DownstreamMember2022-06-300000049938imo:ChemicalMember2023-06-300000049938imo:ChemicalMember2022-06-300000049938us-gaap:CorporateNonSegmentMember2023-01-012023-06-300000049938us-gaap:CorporateNonSegmentMember2022-01-012022-06-300000049938srt:ConsolidationEliminationsMember2023-01-012023-06-300000049938srt:ConsolidationEliminationsMember2022-01-012022-06-300000049938us-gaap:CorporateNonSegmentMember2023-06-300000049938us-gaap:CorporateNonSegmentMember2022-06-300000049938srt:ConsolidationEliminationsMember2023-06-300000049938srt:ConsolidationEliminationsMember2022-06-300000049938country:US2023-01-012023-06-300000049938country:US2022-01-012022-06-300000049938us-gaap:PensionPlansDefinedBenefitMember2023-04-012023-06-300000049938us-gaap:PensionPlansDefinedBenefitMember2022-04-012022-06-300000049938us-gaap:PensionPlansDefinedBenefitMember2023-01-012023-06-300000049938us-gaap:PensionPlansDefinedBenefitMember2022-01-012022-06-300000049938us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2023-04-012023-06-300000049938us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2022-04-012022-06-300000049938us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2023-01-012023-06-300000049938us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2022-01-012022-06-300000049938us-gaap:AccountsPayableAndAccruedLiabilitiesMember2023-06-300000049938us-gaap:AccountsPayableAndAccruedLiabilitiesMember2022-12-310000049938imo:CrudeBarrelsMember2023-01-012023-06-30utr:bbl0000049938imo:CrudeBarrelsMember2022-01-012022-12-310000049938imo:ProductsBarrelsMember2023-01-012023-06-300000049938imo:ProductsBarrelsMember2022-01-012022-12-310000049938us-gaap:FairValueInputsLevel1Member2023-06-300000049938us-gaap:FairValueInputsLevel2Member2023-06-300000049938us-gaap:FairValueInputsLevel3Member2023-06-300000049938imo:DerivativeFairValueOfDerivativeAmountEffectOfCounterPartyNettingMember2023-06-300000049938imo:DerivativeFairValueOfDerivativeAmountEffectOfCollateralNettingMember2023-06-300000049938imo:NetCarryingValueMember2023-06-300000049938us-gaap:FairValueInputsLevel1Member2022-12-310000049938us-gaap:FairValueInputsLevel2Member2022-12-310000049938us-gaap:FairValueInputsLevel3Member2022-12-310000049938imo:DerivativeFairValueOfDerivativeAmountEffectOfCounterPartyNettingMember2022-12-310000049938imo:DerivativeFairValueOfDerivativeAmountEffectOfCollateralNettingMember2022-12-310000049938imo:NetCarryingValueMember2022-12-310000049938imo:MasterNettingArrangementsMember2023-06-300000049938imo:MasterNettingArrangementsMember2022-12-3100000499382023-06-292023-06-290000049938imo:NormalCourseIssuerBidEffectiveFromJuneTwentyNinthTwoThousandAndTwentyThreeMember2023-06-290000049938imo:ExxonMobilCorporationMemberimo:NormalCourseIssuerBidEffectiveFromJuneTwentyNinthTwoThousandAndTwentyThreeMember2023-06-152023-06-15xbrli:pure0000049938imo:ExxonMobilCorporationMemberimo:NormalCourseIssuerBidEffectiveFromJuneTwentyNinthTwoThousandAndTwentyThreeMember2023-06-290000049938us-gaap:CommonStockMember2022-01-012022-12-310000049938us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-12-310000049938us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-12-310000049938us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2023-01-012023-06-300000049938us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-01-012022-06-300000049938us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2023-06-300000049938us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-06-300000049938imo:AccumulatedDefinedBenefitPlansAdjustmentBeforeTaxMember2023-04-012023-06-300000049938imo:AccumulatedDefinedBenefitPlansAdjustmentBeforeTaxMember2022-04-012022-06-300000049938imo:AccumulatedDefinedBenefitPlansAdjustmentBeforeTaxMember2023-01-012023-06-300000049938imo:AccumulatedDefinedBenefitPlansAdjustmentBeforeTaxMember2022-01-012022-06-30

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 June 30, 2023

☐ 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 0-12014

IMPERIAL OIL LIMITED

(Exact name of registrant as specified in its charter)


Canada						98-0017682
(State or other jurisdiction						(I.R.S. Employer
of incorporation or organization)						Identification No.)

505 Quarry Park Boulevard S.E. Calgary, Alberta, Canada						T2C 5N1
(Address of principal executive offices)						(Postal Code)

1-800-567-3776

(Registrant’s telephone number, including area code)

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

Title of each class

Trading symbol

Name of each exchange on

which registered

None

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 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 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 definition of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act of 1934.

Large accelerated filer

✓

Smaller reporting company

Non-accelerated filer

Emerging growth company

Accelerated filer

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 of 1934).


Yes						No			✓

The number of common shares outstanding, as of June 30, 2023 was 584,152,718.


			IMPERIAL OIL LIMITED

Table of contents


			Page

PART I. FINANCIAL INFORMATION			3
Item 1. Financial statements			3
Consolidated statement of income			3
Consolidated statement of comprehensive income			4
Consolidated balance sheet			5
Consolidated statement of shareholders’ equity			6
Consolidated statement of cash flows			7
Notes to consolidated financial statements			8
Item 2. Management’s discussion and analysis of financial condition and results of operations			19
Item 3. Quantitative and qualitative disclosures about market risk			27
Item 4. Controls and procedures			27

PART II. OTHER INFORMATION			28
Item 1. Legal proceedings			28
Item 2. Unregistered sales of equity securities and use of proceeds			28
Item 5. Other information			28
Item 6. Exhibits			29

SIGNATURES			30

In this report, all dollar amounts are expressed in Canadian dollars unless otherwise stated. This report should be read in conjunction with the company’s annual report on Form 10-K for the year ended December 31, 2022. Note that numbers may not add due to rounding.

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.

In this report, unless the context otherwise indicates, reference to “the company” or “Imperial” includes Imperial Oil Limited and its subsidiaries.


			IMPERIAL OIL LIMITED

PART I. FINANCIAL INFORMATION

Item 1. Financial statements

Consolidated statement of income (U.S. GAAP, unaudited)


	Second Quarter		Six Months to June 30
millions of Canadian dollars	2023	2022	2023	2022
Revenues and other income
Revenues (a)	11,764	17,285	23,821	29,942
Investment and other income (note 3)	55	22	119	51
Total revenues and other income	11,819	17,307	23,940	29,993

Expenses
Exploration	1	1	2	3
Purchases of crude oil and products (b)	7,856	11,021	15,334	19,371
Production and manufacturing (c)	1,785	1,908	3,541	3,567
Selling and general (c)	206	191	392	416
Federal excise tax and fuel charge	598	553	1,127	1,032
Depreciation and depletion	453	451	943	877
Non-service pension and postretirement benefit	20	5	40	9
Financing (d) (note 5)	16	11	32	18
Total expenses	10,935	14,141	21,411	25,293

Income (loss) before income taxes	884	3,166	2,529	4,700

Income taxes	209	757	606	1,118

Net income (loss)	675	2,409	1,923	3,582

Per share information (Canadian dollars)
Net income (loss) per common share - basic (note 9)	1.16	3.63	3.29	5.37
Net income (loss) per common share - diluted (note 9)	1.15	3.63	3.29	5.36
(a) Amounts from related parties included in revenues.	3,556	5,175	6,692	9,134
(b) Amounts to related parties included in purchases of crude oil and products.	964	1,129	2,042	1,779
(c) Amounts to related parties included in production and manufacturing, and selling and general expenses.	125	116	260	234
(d) Amounts to related parties included in financing.	41	13	80	17

The information in the notes to consolidated financial statements is an integral part of these statements.


			IMPERIAL OIL LIMITED

Consolidated statement of comprehensive income (U.S. GAAP, unaudited)


	Second Quarter		Six Months to June 30
millions of Canadian dollars	2023	2022	2023	2022
Net income (loss)	675	2,409	1,923	3,582

Other comprehensive income (loss), net of income taxes
Postretirement benefits liability adjustment (excluding amortization)	—	—	21	24

Amortization of postretirement benefits liability adjustment included in net benefit costs	10	21	20	42
Total other comprehensive income (loss)	10	21	41	66

Comprehensive income (loss)	685	2,430	1,964	3,648

The information in the notes to consolidated financial statements is an integral part of these statements.


			IMPERIAL OIL LIMITED

Consolidated balance sheet (U.S. GAAP, unaudited)


millions of Canadian dollars	As at June 30 2023	As at Dec 31 2022
Assets
Current assets
Cash and cash equivalents	2,376	3,749
Accounts receivable - net (a)	4,585	4,719
Inventories of crude oil and products	1,460	1,514
Materials, supplies and prepaid expenses	869	754
Total current assets	9,290	10,736
Investments and long-term receivables (b)	998	893
Property, plant and equipment,	55,424	54,568
less accumulated depreciation and depletion	(24,945)	(24,062)
Property, plant and equipment, net	30,479	30,506
Goodwill	166	166
Other assets, including intangibles - net	1,193	1,223
Total assets	42,126	43,524

Liabilities
Current liabilities
Notes and loans payable	122	122
Accounts payable and accrued liabilities (a) (note 7)	5,923	6,194
Income taxes payable	184	2,582
Total current liabilities	6,229	8,898
Long-term debt (c) (note 6)	4,022	4,033
Other long-term obligations (note 7)	3,418	3,467
Deferred income tax liabilities	4,629	4,713
Total liabilities	18,298	21,111

Shareholders’ equity
Common shares at stated value (d) (note 9)	1,079	1,079
Earnings reinvested	23,220	21,846
Accumulated other comprehensive income (loss) (note 10)	(471)	(512)
Total shareholders’ equity	23,828	22,413

Total liabilities and shareholders’ equity	42,126	43,524
(a) Accounts receivable - net included net amounts receivable from related parties of $1,029 million (2022 - $1,108 million).
(b) Investments and long-term receivables included amounts from related parties of $286 million (2022 - $288 million).
(c) Long-term debt included amounts to related parties of $3,447 million (2022 - $3,447 million).
(d) Number of common shares authorized and outstanding were 1,100 million and 584 million, respectively (2022 - 1,100 million and 584 million, respectively).

The information in the notes to consolidated financial statements is an integral part of these statements.


			IMPERIAL OIL LIMITED

Consolidated statement of shareholders’ equity (U.S. GAAP, unaudited)


	Second Quarter		Six Months to June 30
millions of Canadian dollars	2023	2022	2023	2022
Common shares at stated value (note 9)
At beginning of period	1,079	1,237	1,079	1,252
Share purchases at stated value	—	(60)	—	(75)
At end of period	1,079	1,177	1,079	1,177

Earnings reinvested
At beginning of period	22,837	22,171	21,846	21,660
Net income (loss) for the period	675	2,409	1,923	3,582
Share purchases in excess of stated value	—	(2,440)	—	(2,874)
Dividends declared	(292)	(227)	(549)	(455)
At end of period	23,220	21,913	23,220	21,913

Accumulated other comprehensive income (loss) (note 10)
At beginning of period	(481)	(1,132)	(512)	(1,177)
Other comprehensive income (loss)	10	21	41	66
At end of period	(471)	(1,111)	(471)	(1,111)

Shareholders’ equity at end of period	23,828	21,979	23,828	21,979

The information in the notes to consolidated financial statements is an integral part of these statements.


			IMPERIAL OIL LIMITED

Consolidated statement of cash flows (U.S. GAAP, unaudited)


	Second Quarter		Six Months to June 30
millions of Canadian dollars	2023	2022	2023	2022
Operating activities
Net income (loss)	675	2,409	1,923	3,582
Adjustments for non-cash items:
Depreciation and depletion	453	451	943	877
(Gain) loss on asset sales (note 3)	(13)	(4)	(22)	(24)
Deferred income taxes and other	(15)	(149)	(71)	(480)
Changes in operating assets and liabilities:
Accounts receivable	(302)	(1,426)	134	(2,970)
Inventories, materials, supplies and prepaid expenses	420	(27)	(59)	(391)
Income taxes payable	(321)	853	(2,398)	1,312
Accounts payable and accrued liabilities	(48)	499	(303)	2,643
All other items - net (c)	36	76	(83)	47
Cash flows from (used in) operating activities	885	2,682	64	4,596

Investing activities
Additions to property, plant and equipment	(499)	(333)	(928)	(637)
Proceeds from asset sales (note 3) (b)	9	102	23	126

Loans to equity companies - net	1	1	2	2
Cash flows from (used in) investing activities	(489)	(230)	(903)	(509)

Financing activities


Finance lease obligations - reduction (note 6)	(6)	(6)	(11)	(11)
Dividends paid	(257)	(228)	(523)	(413)
Common shares purchased (note 9)	—	(2,500)	—	(2,949)
Cash flows from (used in) financing activities	(263)	(2,734)	(534)	(3,373)

Increase (decrease) in cash and cash equivalents	133	(282)	(1,373)	714
Cash and cash equivalents at beginning of period	2,243	3,149	3,749	2,153
Cash and cash equivalents at end of period (a)	2,376	2,867	2,376	2,867
(a) Cash equivalents are all highly liquid securities with maturity of three months or less.
(b) In the second quarter of 2022, a deposit of $94 million was received for the pending sale of XTO Energy Canada.
(c) Included contributions to registered pension plans.	(44)	(46)	(86)	(96)

Income taxes (paid) refunded.	(557)	(52)	(3,189)	(275)
Interest (paid), net of capitalization.	(16)	(10)	(37)	(22)

The information in the notes to consolidated financial statements is an integral part of these statements.


			IMPERIAL OIL LIMITED

Notes to consolidated financial statements (unaudited)

1. Basis of financial statement preparation

These unaudited consolidated financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) and follow the same accounting policies and methods of computation as, and should be read in conjunction with, the most recent annual consolidated financial statements filed with the U.S. Securities and Exchange Commission (SEC) in the company’s 2022 annual report on Form 10-K. In the opinion of the company, 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.

The company’s exploration and production activities are accounted for under the “successful efforts” method.

The results for the six months ended June 30, 2023, are not necessarily indicative of the operations to be expected for the full year.

All amounts are in Canadian dollars unless otherwise indicated.


			IMPERIAL OIL LIMITED

2. Business segments


Second Quarter	Upstream		Downstream		Chemical
millions of Canadian dollars	2023	2022	2023	2022	2023	2022
Revenues and other income
Revenues (a) (b)	61	119	11,355	16,752	348	414
Intersegment sales	3,519	5,827	1,365	2,024	89	149
Investment and other income (note 3)	10	3	15	9	—	—
	3,590	5,949	12,735	18,785	437	563
Expenses
Exploration	1	1	—

SEC Form 10-Q filed by Imperial Oil Limited