Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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, 2022March 31, 2023
OR
☐
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)
CACanadaNADA
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 classTrading symbol
Name of each exchange on
which registered
NoneNone
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    
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    
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 file
r
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  
✓
YesNo ✓

The number of common shares outstanding, as of June 30, 2022March 31, 2023 was 636,676,182.584,152,718.

Table of Contents
IMPERIAL OIL LIMITED

Table of contents
IMPERIAL OIL LIMITED
Table of contents
Page
Page
3
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 the consolidated financial statements
8
20
17
28
22
28
22
29
23
29
23
29
23
30
24
31
25
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, 2021.2022. 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.
2
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
PART I. FINANCIAL INFORMATION
Item 1. Financial statements
Consolidated statement of income (U.S. GAAP, unaudited)
 
       Three Months
       to March 31
millions of Canadian dollars2023 2022 
Revenues and other income
Revenues (a)
12,057 12,657 
Investment and other income (note 3)
64 29 
Total revenues and other income12,121 12,686 
 
Expenses
Exploration1 2 
Purchases of crude oil and products (b)
7,478 8,350 
Production and manufacturing (c)
1,756 1,659 
Selling and general (c)
186 225 
Federal excise tax and fuel charge529 479 
Depreciation and depletion490 426 
Non-service pension and postretirement benefit20 4 
Financing (d) (note 5)
16 7 
Total expenses10,476 11,152 
 
Income (loss) before income taxes1,645 1,534 
Income taxes397 361 
Net income (loss)1,248 1,173 
Per share information (Canadian dollars)
Net income (loss) per common share - basic (note 9)
2.14 1.75 
Net income (loss) per common share - diluted (note 9)
2.13 1.75 
(a) Amounts from related parties included in revenues.3,136 3,959 
(b) Amounts to related parties included in purchases of crude oil and products.1,078 650 
(c) Amounts to related parties included in production and manufacturing,
and selling and general expenses.		135 118 
(d) Amounts to related parties included in financing, (note 5).39 4 
The information in the notes to consolidated financial statements is an integral part of these statements.

3

IMPERIAL OIL LIMITED
Consolidated statement of comprehensive income (U.S. GAAP, unaudited)
             Six Months 
       Second Quarter         to June 30 
millions of Canadian dollars
  
2022
         2021     
2022
   2021 
Revenues and other income
          
Revenues
(a)
  
 
17,285
 
  8,007   
 
29,942
 
  14,999 
Investment and other income
(note 3)
  
 
22
 
    40   
 
51
 
  46 
Total revenues and other income
  
 
17,307
 
     8,047   
 
29,993
 
     15,045 
     
Expenses
                        
Exploration  
 
1
 
     2   
 
3
 
     4 
Purchases of crude oil and products
(b)
  
 
11,021
 
   4,867   
 
19,371
 
   8,754 
Production and manufacturing
(c)
  
 
1,908
 
   1,569   
 
3,567
 
     3,054 
Selling and general
(c)
  
 
191
 
    200   
 
416
 
     389 
Federal excise tax and fuel charge  
 
553
 
     465   
 
1,032
 
     869 
Depreciation and depletion  
 
451
 
    450   
 
877
 
     944 
Non-service
pension and postretirement benefit
  
 
5
 
  10   
 
9
 
    21 
Financing
(d) (note 5)
  
 
11
 
  13   
 
18
 
    27 
Total expenses
  
 
14,141
 
     7,576   
 
25,293
 
    14,062 
     
Income (loss) before income taxes
  
 
3,166
 
    471   
 
4,700
 
    983 
     
Income taxes
  
 
757
 
   105   
 
1,118
 
     225 
     
Net income (loss)
  
 
2,409
 
   366   
 
3,582
 
     758 
    
Per share information
(Canadian dollars)
 
                   
Net income (loss) per common share - basic
(note 9)
  
 
3.63
 
   0.51   
 
5.37
 
    1.04 
Net income (loss) per common share - diluted
(note 9)
  
 
3.63
 
    0.50   
 
5.36
 
     1.04 
(a)  Amounts from related parties included in revenues.  
 
5,175
 
     1,405   
 
9,134
 
    2,913 
(b)  Amounts to related parties included in purchases of crude oil and products.  
 
1,129
 
   666   
 
1,779
 
    1,181 
(c)   Amounts to related parties included in production and manufacturing, and selling and general expenses.  
 
116
 
   106   
 
234
 
  222 
(d)  Amounts to related parties included in financing (note 5).  
 
13
 
     10   
 
17
 
  21 
The information in the notes to consolidated financial statements is an integral part of these statements.
3
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        Three Months
        to March 31
millions of Canadian dollars2023 2022 
Net income (loss)1,248 1,173 
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 
Total other comprehensive income (loss)31 45 
Comprehensive income (loss)1,279 1,218 
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)
 
 
         Six Months 
   Second Quarter     to June 30 
millions of Canadian dollars
  
 
2022
 
   2021     
 
2022
 
   2021 
Net income (loss)
  
 
2,409
 
     366   
 
3,582
 
   758 
     
Other comprehensive income (loss), net of income taxes                      
Postretirement benefits liability adjustment (excluding amortization)  
 
-
 
     -   
 
24
 
    54 
     
Amortization of postretirement benefits liability adjustment included in net benefit costs  
 
21
 
     33   
 
42
 
   66 
Total other comprehensive income (loss)
  
 
21
 
     33   
 
66
 
     120 
                         
Comprehensive income (loss)
  
 
2,430
 
     399   
 
3,648
 
   878 
The information in the notes to consolidated financial statements is an integral part of these statements.
4
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IMPERIAL OIL LIMITED
Consolidated balance sheet (U.S. GAAP, unaudited)
millions of Canadian dollars
As at
Mar 31
2023
As at
Dec 31
2022
Assets  
Current assets  
Cash and cash equivalents2,243 3,749 
Accounts receivable - net (a)
4,283 4,719 
Inventories of crude oil and products1,757 1,514 
Materials, supplies and prepaid expenses989 754 
Total current assets9,272 10,736 
Investments and long-term receivables (b)
995 893 
Property, plant and equipment,54,991 54,568 
less accumulated depreciation and depletion(24,549)(24,062)
Property, plant and equipment, net30,442 30,506 
Goodwill166 166 
Other assets, including intangibles - net1,240 1,223 
Total assets42,115 43,524 
Liabilities  
Current liabilities  
Notes and loans payable122 122 
Accounts payable and accrued liabilities (a) (note 7)
5,930 6,194 
Income taxes payable505 2,582 
Total current liabilities6,557 8,898 
Long-term debt (c) (note 6)
4,027 4,033 
Other long-term obligations (note 7)
3,409 3,467 
Deferred income tax liabilities4,687 4,713 
Total liabilities18,680 21,111 
Shareholders’ equity  
Common shares at stated value (d) (note 9)
1,079 1,079 
Earnings reinvested22,837 21,846 
Accumulated other comprehensive income (loss) (note 10)
(481)(512)
Total shareholders’ equity23,435 22,413 
 
Total liabilities and shareholders’ equity42,115 43,524 
(a) Accounts receivable - net included net amounts receivable from related parties of $908 million (2022 - $1,108 million).
(b) Investments and long-term receivables included amounts from related parties of $287 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 balance sheet (U.S. GAAP, unaudited)
   As at      As at 
   June 30      Dec 31 
millions of Canadian dollars
  
 
2022
 
     2021 
Assets
      
Current assets
      
Cash  
 
2,867
 
     2,153 
Accounts receivable - net
(a)
  
 
6,839
 
     3,869 
Inventories of crude oil and products  
 
1,394
 
     1,102 
Materials, supplies and prepaid expenses  
 
789
 
     689 
Total current assets  
 
11,889
 
     7,813 
Investments and long-term receivables
(b)
  
 
754
 
     757 
Property, plant and equipment,  
 
57,222
 
     56,762 
less accumulated depreciation and depletion  
 
(26,256
) 
     (25,522) 
Property, plant and equipment, net
(note 11)
  
 
30,966
 
     31,240 
Goodwill  
 
166
 
     166 
Other assets, including intangibles - net  
 
1,117
 
     806 
Total assets
  
 
44,892
 
     40,782 
   
Liabilities
            
Current liabilities            
Notes and loans payable  
 
122
 
     122 
Accounts payable and accrued liabilities
(a) (note 7)
  
 
7,947
 
     5,184 
Income taxes payable  
 
2,018
 
     248 
Total current liabilities  
 
10,087
 
     5,554 
Long-term debt
(c) (note 6)
  
 
5,044
 
     5,054 
Other long-term obligations
(note 7)
  
 
3,453
 
     3,897 
Deferred income tax liabilities  
 
4,329
 
     4,542 
Total liabilities
  
 
22,913
 
     19,047 
   
Shareholders’ equity
            
Common shares at stated value
(d) (note 9)
  
 
1,177
 
     1,252 
Earnings reinvested  
 
21,913
 
     21,660 
Accumulated other comprehensive income (loss)
(note 10)
  
 
(1,111
) 
     (1,177) 
Total shareholders’ equity
  
 
21,979
 
     21,735 
   
Total liabilities and shareholders’ equity
  
 
44,892
 
     40,782 
(a)Accounts receivable - net included net amounts receivable from related parties of $1,888 million (2021 - $1,031 million).
(b)Investments and long-term receivables included amounts from related parties of $296 million (2021 - $298 million).
(c)Long-term debt included amounts to related parties of $4,447 million (2021 - $4,447 million).
(d)Number of common shares authorized and outstanding were 1,100 million and 637 million, respectively (2021 - 1,100 million and 678 million, respectively).
The information in the notes to consolidated financial statements is an integral part of these statements.
5
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
Consolidated statement of shareholders’ equity (U.S. GAAP, unaudited)
 
        Three Months
        to March 31
millions of Canadian dollars2023 2022 
Common shares at stated value (note 9)
  
At beginning of period1,079 1,252 
Share purchases at stated value— (15)
At end of period1,079 1,237 
Earnings reinvested
At beginning of period21,846 21,660 
Net income (loss) for the period1,248 1,173 
Share purchases in excess of stated value— (434)
Dividends declared(257)(228)
At end of period22,837 22,171 
 
Accumulated other comprehensive income (loss) (note 10)
  
At beginning of period(512)(1,177)
Other comprehensive income (loss)31 45 
At end of period(481)(1,132)
Shareholders’ equity at end of period23,435 22,276 
The information in the notes to consolidated financial statements is an integral part of these statements.

 Consolidated statement of shareholders’ equity (U.S. GAAP, unaudited)
        
        
        
        
       Six Months 
   Second Quarter      to June 30 
millions of Canadian dollars
  
 
2022
 
  2021     
 
2022
 
  2021 
Common shares at stated value
(note 9)
        
At beginning of period  
 
1,237
  
  1,357  
 
1,252
  
  1,357 
Share purchases at stated value  
 
(60
) 
  (55)  
 
(75
) 
  (55) 
At end of period  
 
1,177
 
  1,302  
 
1,177
 
  1,302 
     
Earnings reinvested
                 
At beginning of period  
 
22,171
 
  22,281  
 
21,660
 
  22,050 
Net income (loss) for the period  
 
2,409
 
  366  
 
3,582
 
  758 
Share purchases in excess of stated value  
 
(2,440
) 
  (1,116)  
 
(2,874
) 
  (1,116) 
Dividends declared  
 
(227
) 
  (195)  
 
(455
) 
  (356) 
At end of period  
 
21,913
 
  21,336  
 
21,913
 
  21,336 
     
Accumulated other comprehensive income (loss)
(note 10)
                 
At beginning of period  
 
(1,132
) 
  (1,902)  
 
(1,177
) 
  (1,989) 
Other comprehensive income (loss)  
 
21
 
  33  
 
66
 
  120 
At end of period  
 
(1,111
) 
  (1,869)  
 
(1,111
) 
  (1,869) 
     
Shareholders’ equity at end of period
  
 
21,979
 
  20,769  
 
21,979
 
  20,769 
The information in the notes to consolidated financial statements is an integral part of these statements.
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IMPERIAL OIL LIMITED
Consolidated statement of cash flows (U.S. GAAP, unaudited)
IMPERIAL OIL LIMITED
 
        Three Months
        to March 31
millions of Canadian dollars2023 2022 
Operating activities  
Net income (loss)1,248 1,173 
Adjustments for non-cash items:
Depreciation and depletion490 426 
(Gain) loss on asset sales (note 3)
(9)(20)
Deferred income taxes and other(56)(331)
Changes in operating assets and liabilities:  
Accounts receivable436 (1,544)
Inventories, materials, supplies and prepaid expenses(479)(364)
Income taxes payable(2,077)459 
Accounts payable and accrued liabilities(255)2,144 
All other items - net (b)
(119)(29)
Cash flows from (used in) operating activities(821)1,914 
 
Investing activities  
Additions to property, plant and equipment(429)(304)
Proceeds from asset sales (note 3)
14 24 
Loans to equity companies - net1 1 
Cash flows from (used in) investing activities(414)(279)
Financing activities  
Finance lease obligations - reduction (note 6)
(5)(5)
Dividends paid(266)(185)
Common shares purchased (note 9)
— (449)
Cash flows from (used in) financing activities(271)(639)
 
Increase (decrease) in cash and cash equivalents(1,506)996 
Cash and cash equivalents at beginning of period3,749 2,153 
Cash and cash equivalents at end of period (a)
2,243 3,149 
(a)  Cash is composed of cash in bank and cash equivalents at cost. Cash equivalents are all highly liquid securities with maturity of
       three months or less.
(b)  Included contributions to registered pension plans.(42)(50)
 
Income taxes (paid) refunded.(2,632)(223)
Interest (paid), net of capitalization.(21)(12)
The information in the notes to consolidated financial statements is an integral part of these statements.
 Consolidated statement of cash flows (U.S. GAAP, unaudited)
   
    
   
    
   
    
   
    
 
   
           Six Months 
Inflow (outflow)
   Second Quarter      to June 30 
millions of Canadian dollars
  
 
2022
 
  2021     
 
2022
 
  2021 
Operating activities
                    
Net income (loss)  
 
2,409
 
   366  
 
3,582
 
   758 
Adjustments for
non-cash
items:
                   
Depreciation and depletion  
 
451
 
   450  
 
877
 
   944 
(Gain) loss on asset sales
(note 3)
  
 
(4
) 
   (24)  
 
(24
) 
   (27) 
Deferred income taxes and other  
 
(149
) 
   76  
 
(480
) 
   136 
Changes in operating assets and liabilities:                   
Accounts receivable  
 
(1,426
) 
   (775)  
 
(2,970
) 
   (1,244) 
Inventories, materials, supplies and prepaid expenses  
 
(27
) 
   58  
 
(391
) 
   (101) 
Income taxes payable  
 
853
 
   21  
 
1,312
 
   42 
Accounts payable and accrued liabilities  
 
499
 
   655  
 
2,643
 
   1,239 
All other items - net
(c)
  
 
76
 
   25  
 
47
 
   150 
Cash flows from (used in) operating activities
  
 
2,682
 
   852  
 
4,596
 
   1,897 
     
Investing activities
                   
Additions to property, plant and equipment  
 
(333
) 
   (241)  
 
(637
) 
   (408) 
Proceeds from asset sales
(note 3) (b)
  
 
102
 
   35  
 
126
 
   42 
Loans to equity companies - net  
 
1
 
   (1)  
 
2
 
   12 
Cash flows from (used in) investing activities
  
 
(230
) 
   (207)  
 
(509
) 
   (354) 
     
Financing activities
                   
Short-term debt - net  
 
-
 
   -  
 
-
 
   (36) 
Reduction in finance lease obligations
(note 6)
  
 
(6
) 
   (4)  
 
(11
) 
   (8) 
Dividends paid  
 
(228
) 
   (161)  
 
(413
) 
   (323) 
Common shares purchased
(note 9)
  
 
(2,500
) 
   (1,171)  
 
(2,949
) 
   (1,171) 
Cash flows from (used in) financing activities
  
 
(2,734
) 
   (1,336)  
 
(3,373
) 
   (1,538) 
     
Increase (decrease) in cash
  
 
(282
) 
   (691)  
 
714
 
   5 
Cash at beginning of period
  
 
3,149
 
   1,467  
 
2,153
 
   771 
Cash at end of period
(a)
  
 
2,867
 
   776  
 
2,867
 
   776 
(a)  Cash is composed of cash in bank and cash equivalents at cost. Cash equivalents are all highly liquid securities with maturity of three months or less when purchased.            
(b)  Included $94 million deposit for the potential sale of XTO Energy Canada (note 11).                   
(c)   Included contributions to registered pension plans.  
 
(46
) 
   (42)  
 
(96
) 
   (70) 
     
Income taxes (paid) refunded.  
 
(52
) 
   27  
 
(275
) 
   28 
Interest (paid), net of capitalization.  
 
(10
) 
   (14)  
 
(22
) 
   (27) 
The information in the notes to consolidated financial statements is an integral part of these statements.
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
Notes to consolidated financial statements (unaudited)
1.Basis of financial statement preparation
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 20212022 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 sixthree months ended June 30, 2022,March 31, 2023, are not necessarily indicative of the operations to be expected for the full year.
All amounts are in Canadian dollars unless otherwise indicated.
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IMPERIAL OIL LIMITED
2. Business segments
Three Months to March 31        Upstream        Downstream       Chemical
millions of Canadian dollars202320222023202220232022
Revenues and other income
Revenues (a) (b)
76 99 11,639 12,191 342 367 
Intersegment sales
3,622 4,431 1,823 1,833 91 104 
Investment and other income (note 3)
2 4 20 21 — — 
3,700 4,534 13,482 14,045 433 471 
Expenses
Exploration1 2 — — — — 
Purchases of crude oil and products
1,543 1,890 11,196 12,512 274 315 
Production and manufacturing1,287 1,249 411 356 58 54 
Selling and general— — 157 147 26 23 
Federal excise tax and fuel charge— — 528 479 1 — 
Depreciation and depletion434 373 45 41 4 5 
Non-service pension and postretirement benefit— — — — — — 
Financing (note 5)
— — — — — — 
Total expenses3,265 3,514 12,337 13,535 363 397 
Income (loss) before income taxes435 1,020 1,145 510 70 74 
Income tax expense (benefit)105 238 275 121 17 18 
Net income (loss)
330 782 870 389 53 56 
Cash flows from (used in) operating activities
(398)1,447 (419)375 (32)67 
Capital and exploration expenditures (c)
321 222 74 68 4 1 
Total assets as at March 31
29,059 29,182 9,535 10,179 477 501 
Three Months to March 31Corporate and other       Eliminations        Consolidated
millions of Canadian dollars202320222023202220232022
Revenues and other income
Revenues (a) (b)
— — — — 12,057 12,657 
Intersegment sales
— — (5,536)(6,368)— — 
Investment and other income (note 3)
42 4 — — 64 29 
42 4 (5,536)(6,368)12,121 12,686 
Expenses
Exploration— — — — 1 2 
Purchases of crude oil and products
— — (5,535)(6,367)7,478 8,350 
Production and manufacturing— — — — 1,756 1,659 
Selling and general4 56 (1)(1)186 225 
Federal excise tax and fuel charge— — — — 529 479 
Depreciation and depletion7 7 — — 490 426 
Non-service pension and postretirement benefit20 4 — — 20 4 
Financing (note 5)
16 7 — — 16 7 
Total expenses47 74 (5,536)(6,368)10,476 11,152 
Income (loss) before income taxes(5)(70)— — 1,645 1,534 
Income tax expense (benefit)— (16)— — 397 361 
Net income (loss)
(5)(54)— — 1,248 1,173 
Cash flows from (used in) operating activities
28 25 — — (821)1,914 
Capital and exploration expenditures (c)
30 5 — — 429 296 
Total assets as at March 31
3,815 4,136 (771)(188)42,115 43,810 

IMPERIAL OIL LIMITED
2.
Business segments
   
             
   
             
   
             
   
             
   
             
   
             
 
Second Quarter
         Upstream        Downstream        Chemical 
millions of Canadian dollars
  
 
2022
 
  2021  
 
2022
 
  2021  
 
2022
 
   2021 
Revenues and other income
                          
Revenues
(a) (b)
  
 
119
 
   2,616   
 
16,752
 
   5,015   
 
414
 
   376 
Intersegment sales  
 
5,827
 
   1,312   
 
2,024
 
   788   
 
149
 
   79 
Investment and other income
(note 3)
  
 
3
 
   6   
 
9
 
   28   
 
0-
 
   1 
   
 
5,949
 
   3,934   
 
18,785
 
   5,831   
 
563
 
   456 
Expenses
                              
Exploration  
 
1
 
   2   
 
0-
 
   0-   
 
0-
 
   0- 
Purchases of crude oil and products  
 
2,357
 
   2,044   
 
16,261
 
   4,760   
 
401
 
   240 
Production and manufacturing  
 
1,423
 
   1,166   
 
418
 
   357   
 
67
 
   46 
Selling and general  
 
0-
 
   0-   
 
153
 
   142   
 
22
 
   22 
Federal excise tax and fuel charge  
 
0-
 
   0-   
 
553
 
   465   
 
0-
 
   0- 
Depreciation and depletion  
 
395
 
   399   
 
45
 
   39   
 
4
 
   5 
Non-service
pension and postretirement benefit
  
 
-
 
   0-   
 
0-
 
   0-   
 
0-
 
   0- 
Financing
(note 5)
  
 
1
 
   0-   
 
0-
 
   0-   
 
0-
 
   0- 
Total expenses
  
 
4,177
 
   3,611   
 
17,430
 
   5,763   
 
494
 
   313 
Income (loss) before income taxes
  
 
1,772
 
   323   
 
1,355
 
   68   
 
69
 
   143 
Income tax expense (benefit)
  
 
426
 
   76   
 
322
 
   8   
 
16
 
   34 
Net income (loss)
  
 
1,346
 
   247   
 
1,033
 
   60   
 
53
 
   109 
Cash flows from (used in) operating activities
  
 
2,087
 
   595   
 
641
 
   136   
 
64
 
   111 
Capital and exploration expenditures
(c)
  
 
233
 
   130   
 
69
 
   120   
 
2
 
   2 
   
            
   
            
   
            
   
            
   
            
   
            
 
             
Second Quarter   Corporate and other       Eliminations       Consolidated 
millions of Canadian dollars  
 
2022
 
  2021  
 
2022
 
  2021  
 
2022
 
   2021 
Revenues and other income
                          
Revenues
(a) (b)
  
 
0-
 
  0-  
 
0-
 
  0-  
 
17,285
 
   8,007 
Intersegment sales  
 
0-
 
  0-  
 
(8,000
) 
  (2,179)  
 
0-
 
   0- 
Investment and other income
(note 3)
  
 
10
 
  5  
 
-
 
  0-  
 
22
 
   40 
   
 
10
 
  5  
 
(8,000
) 
  (2,179)  
 
17,307
 
   8,047 
Expenses
                          
Exploration  
 
0-
 
  0-  
 
0-
 
  0-  
 
1
 
   2 
Purchases of crude oil and products  
 
0-
 
  0-  
 
(7,998
) 
  (2,177)  
 
11,021
 
   4,867 
Production and manufacturing  
 
0-
 
  0-  
 
0-
 
  0-  
 
1,908
 
   1,569 
Selling and general  
 
18
 
  38  
 
(2
) 
  (2)  
 
191
 
   200 
Federal excise tax and fuel charge  
 
0-
 
  0-  
 
0-
 
  0-  
 
553
 
   465 
Depreciation and depletion  
 
7
 
  7  
 
0-
 
  0-  
 
451
 
   450 
Non-service pension and postretirement benefit  
 
5
 
  10  
 
0-
 
  0-  
 
5
 
   10 
Financing
(note 5)
  
 
10
 
  13  
 
0-
 
  0-  
 
11
    13 
Total expenses
  
 
40
 
  68  
 
(8,000
) 
  (2,179)  
 
14,141
 
  7,576 
Income (loss) before income taxes
  
 
(30
) 
  (63)  
 
0-
 
  0-  
 
3,166
 
   471 
Income tax expense (benefit)
  
 
(7
) 
  (13)  
 
0-
 
  0-  
 
757
 
   105 
Net income (loss)
  
 
(23
) 
  (50)  
 
0-
 
  0-  
 
2,409
 
   366 
Cash flows from (used in) operating activities
  
 
(110
) 
  10  
 
0-
 
  0-  
 
2,682
 
   852 
Capital and exploration expenditures
(c)
  
 
10
 
  7  
 
0-
 
  0-  
 
314
 
   259 
9
Table

IMPERIAL OIL LIMITED
(a)Includes export sales to the United States of Contents$2,375 million (2022 - $2,504 million).
(b)Revenues include both revenue within the scope of ASC 606 and outside the scope of ASC 606. Trade receivables in "Accounts receivable – net" reported on the Consolidated balance sheet include both receivables within the scope of ASC 606 and those outside the scope of ASC 606. Revenue and receivables outside the scope of ASC 606 primarily relate to physically settled commodity contracts accounted for as derivatives. Contractual terms, credit quality, and type of customer are generally similar between those revenues and receivables within the scope of ASC 606 and those outside it.
Revenues
       Three Months
       to March 31
millions of Canadian dollars2023 2022 
Revenue from contracts with customers10,520 10,864 
Revenue outside the scope of ASC 606
1,537 1,793 
Total12,057 12,657 
(c)Capital and exploration expenditures (CAPEX) include exploration expenses, additions to property, plant and equipment, additions to finance leases, additional investments and acquisitions and the company’s share of similar costs for equity companies. CAPEX excludes the purchase of carbon emission credits.
IMPERIAL OIL LIMITED
(a)Included export sales to the United States of $3,871 million (2021 - $1,544 million).
(b)
Includes approximately 13% related to revenue outside the scope of ASC 606 “Revenue from Contracts with Customers” for the three months ended June 30, 2022. Trade receivables in Accounts receivable – net reported on the Balance Sheet include both receivables within the scope of ASC 606 and those outside the scope of ASC 606. Revenue and receivables outside the scope of ASC 606 primarily relate to physically settled commodity contracts accounted for as derivatives
. Credit
quality and type of customer are generally similar
between
those revenues and receivables within the scope of ASC 606
 and those outside it
.
(c)Capital and exploration expenditures (CAPEX) include exploration expenses, additions to property, plant and equipment, additions to finance leases, additional investments and acquisitions and the company’s share of similar costs for equity companies. CAPEX excludes the purchase of carbon emission credits.
10
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IMPERIAL OIL
LIMITED
IMPERIAL OIL LIMITED
                                                                                                 
Six Months to June 30
         Upstream         Downstream         Chemical 
millions of Canadian dollars
  
 
2022
 
  2021   
 
2022
 
  2021   
 
2022
 
   2021 
Revenues and other income
                            
Revenues
(a) (b)
  
 
218
 
   4,758   
 
28,943
 
   9,542   
 
781
 
   699 
Intersegment sales  
 
10,258
 
   2,663   
 
3,857
 
   1,561   
 
253
 
   132 
Investment and other income
(note 3)
  
 
7
 
   6   
 
30
 
   33   
 
0-
 
   1 
   
 
10,483
 
   7,427   
 
32,830
 
   11,136   
 
1,034
 
   832 
Expenses
                              
Exploration  
 
3
 
   4   
 
0-
 
   0-   
 
0-
 
   0- 
Purchases of crude oil and products  
 
4,247
 
   3,878   
 
28,773
 
   8,780   
 
716
 
   449 
Production and manufacturing  
 
2,672
 
   2,275   
 
774
 
   683   
 
121
 
   96 
Selling and general  
 
0-
 
   0-   
 
300
 
   275   
 
45
 
   47 
Federal excise tax and fuel charge  
 
0-
 
   0-   
 
1,032
 
   869   
 
0-
 
   0- 
Depreciation and depletion  
 
768
 
   844   
 
86
 
   78   
 
9
 
   9 
Non-service pension and postretirement benefit  
 
0-
 
   0-   
 
0-
 
   0-   
 
0-
 
   0- 
Financing
(note 5)
  
 
1
 
   1   
 
0-
 
   0-   
 
0-
 
   0- 
Total expenses
  
 
7,691
 
   7,002   
 
30,965
 
   10,685   
 
891
 
   601 
Income (loss) before income taxes
  
 
2,792
 
   425   
 
1,865
 
   451   
 
143
 
   231 
Income tax expense (benefit)
  
 
664
 
   99   
 
443
 
   99   
 
34
 
   55 
Net income (loss)
  
 
2,128
 
   326   
 
1,422
 
   352   
 
109
 
   176 
Cash flows from (used in) operating activities
  
 
3,534
 
   1,126   
 
1,016
 
   598   
 
131
 
   173 
Capital and exploration expenditures
(c)
  
 
455
 
   215   
 
137
 
   188   
 
3
 
   4 
Total assets as at June 30
(note 11)
  
 
28,961
 
   31,931   
 
11,649
 
   5,352   
 
505
 
   481 
   
   
   
   
   
   
   
   
   
   
   
   
 
             
Six Months to June 30
   Corporate and other        Eliminations        Consolidated 
millions of Canadian dollars
 
 
2022
 
  2021     
 
2022
 
  2021     
 
2022
 
  2021 
Revenues and other income
                              
Revenues
(a) (b)
  
 
0-
 
  0-  
 
0-
 
  0-  
 
29,942
 
   14,999 
Intersegment sales  
 
0-
 
  0-  
 
(14,368
) 
  (4,356)  
 
0-
 
   0- 
Investment and other income
(note 3)
  
 
14
 
  6  
 
0-
 
  0-  
 
51
 
   46 
   
 
14
 
  6  
 
(14,368
) 
  (4,356)  
 
29,993
 
   15,045 
Expenses
                          
Exploration  
 
0-
 
  0-  
 
0-
 
  0-  
 
3
 
   4 
Purchases of crude oil and products  
 
0-
 
  0-  
 
(14,365
) 
  (4,353)  
 
19,371
 
   8,754 
Production and manufacturing  
 
0-
 
  0-  
 
0-
 
  0-  
 
3,567
 
   3,054 
Selling and general  
 
74
 
  70  
 
(3
) 
  (3)  
 
416
 
   389 
Federal excise tax and fuel charge  
 
0-
 
  0-  
 
0-
 
  0-  
 
1,032
 
   869 
Depreciation and depletion  
 
14
 
  13  
 
0-
 
  0-  
 
877
 
   944 
Non-service pension and postretirement benefit  
 
9
 
  21  
 
0-
 
  0-  
 
9
 
   21 
Financing
(note 5)
  
 
17
 
  26  
 
0-
 
  0-  
 
18
 
   27 
Total expenses
  
 
114
 
  130  
 
(14,368
) 
  (4,356)  
 
25,293
 
   14,062 
Income (loss) before income taxes
  
 
(100
) 
  (124)  
 
0-
 
  0-  
 
4,700
 
   983 
Income tax expense (benefit)
  
 
(23
) 
  (28)  
 
0-
 
  0-  
 
1,118
 
   225 
Net income (loss)
  
 
(77
) 
  (96)  
 
0-
 
  0-  
 
3,582
 
   758 
Cash flows from (used in) operating activities
  
 
(85
) 
  0-  
 
0-
 
  0-  
 
4,596
 
   1,897 
Capital and exploration expenditures
(c)
  
 
15
 
  15  
 
0-
 
  0-  
 
610
 
   422 
Total assets as at June 30
(note 11)

  
 
4,016
 
  1,606  
 
(239
) 
  (431)  
 
44,892
 
   38,939 
11
Table of Contents
IMPERIAL OIL LIMITED
(a)Included export sales to the United States of $6,375 million (2021 - $3,113 million).
(b)
Includes approximately 11% related to revenue outside the scope of ASC 606 “Revenue from Contracts with Customers” for the six months ended June 30, 2022. Trade receivables in Accounts receivable – net reported on the Balance Sheet include both receivables within the scope of ASC 606 and those outside the scope of ASC 606. Revenue and receivables outside the scope of ASC 606 primarily relate to physically settled commodity contracts accounted for as derivatives
. Credit
quality and type of customer are generally similar
between
those revenues and receivables within the scope of ASC 606
 and those outside it
.
(c)Capital and exploration expenditures (CAPEX) include exploration expenses, additions to property, plant and equipment, additions to finance leases, additional investments and acquisitions and the company’s share of similar costs for equity companies. CAPEX excludes the purchase of carbon emission credits.
12
Table of Contents
IMPERIAL OIL LIMITED

3.
3. Investment and other income
Investment and other income included gains and losses on asset sales as follows:
           Three Months
           to March 31
millions of Canadian dollars2023 2022 
Proceeds from asset sales14 24 
Book value of asset sales5 4 
Gain (loss) on asset sales, before tax9 20 
Gain (loss) on asset sales, after tax8 16 
                                                
       Second Quarter     
Six Months
to June 30
 
 millions of Canadian dollars
  
2022
  2021     
2022
  2021 
Proceeds from asset sales  
 
8
 
     35     
 
32
 
     42 
Book value of asset sales  
 
4
 
     11     
 
8
 
     15 
Gain (loss) on asset sales, before tax  
 
4
 
     24     
 
24
 
     27 
Gain (loss) on asset sales, after tax  
 
3
 
     22     
 
19
 
     24 
4.
Employee retirement benefits
The components of net benefit cost were as follows:
 
         Three Months
         to March 31
millions of Canadian dollars2023 2022 
Pension benefits:
Service cost41 70 
Interest cost93 73 
Expected return on plan assets(93)(103)
Amortization of prior service cost4 4 
Amortization of actuarial loss (gain)11 22 
Net benefit cost56 66 
Other postretirement benefits:
Service cost3 6 
Interest cost7 6 
Amortization of actuarial loss (gain)(2)2 
Net benefit cost8 14 
                                                
       Second Quarter     
Six Months
to June 30
 
 millions of Canadian dollars
  
2022
  2021     
2022
  2021 
Pension benefits:
        
Service cost  
 
70
 
     81     
 
140
 
     162 
Interest cost  
 
74
 
     68     
 
147
 
     136 
Expected return on plan assets  
 
(103)
 
     (107)     
 
(206)
 
     (214) 
Amortization of prior service cost  
 
4
 
     4     
 
8
 
     8 
Amortization of actuarial loss (gain)  
 
21
 
     36     
 
43
 
     72 
Net benefit cost  
 
66
 
     82     
 
132
 
     164 
     
Other postretirement benefits:                          
Service cost  
 
5
 
     7     
 
11
 
     14 
Interest cost  
 
6
 
     5     
 
12
 
     11 
Amortization of actuarial loss (gain)  
 
3
 
     4     
 
5
 
     8 
Net benefit cost  
 
14
 
     16     
 
28
 
     33 
5. Financing costs
5.
  Financing costs
        Three Months
         to March 31
millions of Canadian dollars2023 2022 
Debt-related interest46 12 
Capitalized interest(30)(5)
Net interest expense16 7 
Other interest— — 
Total financing16 7 
                                                
       Second Quarter     
Six Months
to June 30
 
 millions of Canadian dollars  
2022
  2021     
2022
  2021 
Debt-related interest  
 
20
 
     20     
 
32
 
     41 
Capitalized interest  
 
(10)
 
     (7)     
 
(15)
      (15) 
Net interest expense  
 
10
 
     13     
 
17
 
     26 
Other interest  
 
1
 
     -     
 
1
 
     1 
Total financing  
 
11
 
     13     
 
18
 
     27 

In June 2022, the company reduced its existing $500 million committed long-term line of credit to $250 million and extended the maturity date to June 30, 2023. The company also extended one of its $250 million committed long-term lines of credit to June 30, 2024. The company has not drawn on any of its outstanding $750 million of available credit facilities.
1311
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IMPERIAL OIL LIMITED
6. Long-term debt
millions of Canadian dollarsAs at
Mar 31		As at
Dec 31
20232022
Long-term debt
3,447 3,447 
Finance leases
580 586 
Total long-term debt4,027 4,033 
7. Other long-term obligations
 
As at
Mar 31
As at
 Dec 31
millions of Canadian dollars20232022
Employee retirement benefits (a)
875 902 
Asset retirement obligations and other environmental liabilities (b)
2,158 2,150 
Share-based incentive compensation liabilities99 101 
Operating lease liability (c)
137 151 
Other obligations140 163 
Total other long-term obligations3,409 3,467 
(a)Total recorded employee retirement benefits obligations also included $63 million in current liabilities (2022 - $63 million).
(b)Total asset retirement obligations and other environmental liabilities also included $116 million in current liabilities (2022 - $116 million).
(c)Total operating lease liability also included $100 million in current liabilities (2022 - $100 million). In addition to the total operating lease liability, additional undiscounted commitments for leases not yet commenced totalled $13 million (2022 - $14 million).

IMPERIAL OIL LIMITED
6.
Long-term debt
         
   As at
June 30		     As at
Dec 31		 
  millions of Canadian dollars  
2022
     2021 
 Long-term debt  
 
4,447
 
     4,447 
 Finance leases
 
 
 
597
 
  
607
 
 Total long-term debt  
 
5,044
 
     5,054 
7.
Other long-term obligations
         
   As at
June 30		     As at
Dec 31		 
  millions of Canadian dollars  
2022
     2021 
 Employee retirement benefits
(a)
  
 
1,323
 
     1,362 
 Asset retirement obligations and other environmental liabilities
(b)
  
 
1,733
 
     1,713 
 Share-based incentive compensation liabilities  
 
119
 
     79 
 Operating lease liability
(c)
  
 
122
 
     147 
 Other obligations  
 
156
 
     596 
 Total other long-term obligations  
 
3,453
 
     3,897 
(a)Total recorded employee retirement benefits obligations also included $56 million in current liabilities (2021 - $56 million).
(b)Total asset retirement obligations and other environmental liabilities also included $102 million in current liabilities (2021 - $102 million).
(c)Total operating lease liability also included $86 million in current liabilities (2021 - $102 million). In addition to the total operating lease liability, additional undiscounted commitments for leases not yet commenced totalled $11 million (2021 - $5 million).
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
8.
8. Financial and derivative instruments
Financial instruments
The fair value of the company’s financial instruments is determined by reference to various market data and other appropriate valuation techniques. There are no material differences between the fair value of the company’s financial instruments and the recorded carrying value. At June 30, 2022March 31, 2023 and December 31, 2021,2022, the fair value of long-term debt ($4,4473,447 million, excluding finance lease obligations) was primarily a level 2 measurement.
Derivative instruments
The company’s size, strong capital structure and the complementary nature of the Upstream, Downstream and Chemical businessesits business segments reduce the company’s enterprise-wide risk from changes in commodity prices and currency exchange rates. In addition, the company uses commodity-based contracts, including derivative instrumentsderivatives, to manage commodity price risk and to generate returns from trading. Commodity contracts held for trading purposes are presented in the Consolidated statement of income on a net basis in the line “Revenues”. The company does not designate derivative instruments as a hedge for hedge accounting purposes.
Credit risk associated with the company’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 company maintains a system of controls that includes the authorization, reporting and monitoring of derivative activity.
The net notional long/(short) position of derivative instruments was:
         
   As at
June 30		   As at
Dec 31		 
 thousands of barrels  
2022
   2021 
Crude  
 
8,680
 
   7,390 
Products  
 
(930
) 
   (560) 
 
As at
Mar 31
As at
Dec 31
thousands of barrels20232022
Crude3,490 1,800 
Products(400)(350)
Realized and unrealized gain or gain/(loss) on derivative instruments recognized in the Consolidated statement of income is included in the following lines on a
before-tax
basis:
 
    Three Months
    to March 31
millions of Canadian dollars2023 2022 
Revenues(23)37 


















13
  Second Quarter         Six Months
to June 30		 
 millions of Canadian dollars
 
2022
  2021       
2022
   2021 
Revenues  
 
(51
) 
  (9) 
 
 
 
 
 
 
(14
) 
  (9) 
Purchases of crude oil and products  
 
-
 
  (19) 
 
 
 
 
 
 
-
 
      (33) 
Total  
 
(51
) 
  (28) 
 
 
 
 
 
 
(14
) 
  (42) 

IMPERIAL OIL LIMITED
15
Table of Contents
IMPERIAL OIL LIMITED
The estimated fair value of derivative instruments, and the related hierarchy level for the fair value measurement iswas as follows:

                             
 At June 30, 2022
 millions of Canadian dollars
   Fair value   Effect of  Effect of  Net 
                   counterparty  collateral  carrying 
    Level 1   Level 2   Level 3   Total   netting  netting  value 
 Assets
 
                            
Derivative assets
(a)
  
 
35
 
  
 
25
 
  
 
-
 
  
 
60
 
  
 
(44
) 
 
 
(3
) 
 
 
13
 
       
 Liabilities
 
                            
Derivative liabilities
(b)
  
 
32
 
  
 
47
 
  
 
-
 
  
 
79
 
  
 
(44
) 
 
 
-
 
 
 
35
 
(a)Included in the Consolidated balance sheet line: “Materials, supplies and prepaid expenses”, “Accounts receivable - net” and “Other assets, including intangibles - net”.
(b)Included in the Consolidated balance sheet line: “Accounts payable and accrued liabilities” and “Other long-term obligations”.
At March 31, 2023
millions of Canadian dollars
Fair valueEffect of
counterparty
netting		Effect of
collateral
netting		Net
carrying
value
Level 1Level 2Level 3Total
Assets
Derivative assets (a)
13 26 — 39 (25)— 14 
Liabilities
Derivative liabilities (b)
17 47 — 64 (25)(3)36 
(a)Included in the Consolidated balance sheet line: “Materials, supplies and prepaid expenses”, “Accounts receivable - net” and “Other assets, including intangibles - net”.
(b)Included in the Consolidated balance sheet line: “Accounts payable and accrued liabilities” and “Other long-term obligations”.
                             
 At December 31, 2021 
 millions of Canadian dollars 
   Fair value   Effect of  Effect of  Net 
                   counterparty  collateral  carrying 
    Level 1   Level 2   Level 3   Total   netting  netting  value 
 Assets
                                 
Derivative assets
(a)
   24    17    -    41    (31)   -   10 
        
 Liabilities
                                 
Derivative liabilities
(b)
   31    12    -    43    (31)   (7)   5 
 (a)Included in the Consolidated balance sheet line: “Materials, supplies and prepaid expenses”, “Accounts receivable - net” and “Other assets, including intangibles - net”.
 (b)Included in the Consolidated balance sheet line: “Accounts payable and accrued liabilities” and “Other long-term obligations”.

At December 31, 2022
millions of Canadian dollars
Fair valueEffect of
counterparty
netting		Effect of
collateral
netting		Net
carrying
value
Level 1Level 2Level 3Total
Assets
Derivative assets (a)
17 32 — 49 (27)— 22 
Liabilities
Derivative liabilities (b)
21 20 — 41 (27)(4)10 
(a)Included in the Consolidated balance sheet line: “Materials, supplies and prepaid expenses”, “Accounts receivable - net” and “Other assets, including intangibles - net”.
(b)Included in the Consolidated balance sheet line: “Accounts payable and accrued liabilities” and “Other long-term obligations”.
At June 30, 2022March 31, 2023 and December 31, 2021,2022, the company had $16$9 million and $6$14 million, respectively, of collateral under a master netting arrangement not offset against the derivatives on the Consolidated balance sheet in “Accounts receivable - net”, primarily related to initial margin requirements.
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
9. Common shares

thousands of shares
As of
Mar 31
2023
 As of
Dec 31
2022
Authorized1,100,000 1,100,000 
Common shares outstanding584,153 584,153 
9.
Common shares
           As of             As of 
   June 30     Dec 31 
 thousands of shares
  
2022
 
 
    
2021 
         
Authorized  
 
1,100,000
 
 
 
   1,100,000 
Common shares outstanding  
 
636,676
 
 
   678,080 
The
12-month
normal course issuer bid program that was in place during the first quarter of 2022 came into effect June 29, 2021. The program enabled the company to purchase up to a maximum of 35,583,671 common shares (5 percent of the total shares on June 15, 2021), which included shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation participated to maintain its ownership percentage at approximately 69.6 percent. The program completed on January 31, 2022 as a result of the company purchasing the maximum allowable number of shares under the program.
The current
12-month
normal course issuer bid program came into effect June 29, 2022 under which Imperial will continue its existing share purchase program. The program enables the company to purchase up to a maximum of 31,833,809 common shares (5 percent of the total shares on June 15, 2022) which includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent. Imperial plans to accelerate its share purchases under the normal course issuer bid program and anticipates repurchasing all remaining allowable shares by the end of October 2022. Purchase plans may be modified at any time without prior notice.
On May 6, 2022, the company commenced a substantial issuer bid pursuant to which it offered to purchase for cancellation up to $2.5 billion of its common shares through a modified Dutch auction and proportionate tender offer. The substantial issuer bid was completed on June 15, 2022, with the company taking up and paying for 32,467,532 common shares at a price of $77.00 per share, for an aggregate purchase of $2.5 billion and 4.9 percent of Imperial’s issued and outstanding shares as the close of business on May 2, 2022. This included 22,597,379 shares purchased from Exxon Mobil Corporation by way of a proportionate tender to maintain its ownership percentage at approximately 69.6 percent.
The excess of the purchase cost over the stated value of shares purchased has been recorded as a distribution of earnings reinvested.
The company’s common share activities are summarized below:
   Thousands of
shares		 Millions of
dollars		  Thousands of
 shares		Millions of
 dollars
Balance as at December 31, 2020   734,077   1,357 
Issued under employee share-based awards   7   - 
Purchases at stated value   (56,004)   (105) 
Balance as at December 31, 2021   678,080   1,252 Balance as at December 31, 2021678,080 1,252 
Issued under employee share-based awards   -   - Issued under employee share-based awards— — 
Purchases at stated value   (41,404)   (75) Purchases at stated value(93,927)(173)
Balance as at June 30, 2022
  
 
636,676
 
 
 
1,177
 
Balance as at December 31, 2022Balance as at December 31, 2022584,153 1,079 
Issued under employee share-based awardsIssued under employee share-based awards— — 
Purchases at stated valuePurchases at stated value— — 
Balance as at March 31, 2023Balance as at March 31, 2023584,153 1,079 
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IMPERIAL OIL LIMITED
The following table provides the calculation of basic and diluted earnings per common share and the dividends declared by the company on its outstanding common shares:
          Six Months 
   Second Quarter      to June 30 
 
 
 
2022
   2021      
2022
   2021 
Net income (loss) per common share - basic
                   
Net income (loss)
(millions of Canadian dollars)
  
 
2,409
 
   366   
 
3,582
 
   758 
Weighted average number of common shares outstanding
(millions of shares)
  
 
663.0
 
   724.1   
 
666.7
 
   729.1 
Net income (loss) per common share
(dollars)
  
 
3.63
 
   0.51   
 
5.37
 
   1.04 
Net income (loss) per common share - diluted
                    
Net income (loss)
(millions of Canadian dollars)
  
 
2,409
 
   366   
 
3,582
 
   758 
Weighted average number of common shares outstanding
(millions of shares)
  
 
663.0
 
   724.1   
 
666.7
 
   729.1 
Effect of employee share-based awards
(millions of shares)
  
 
1.4
 
   1.7   
 
1.4
 
   1.7 
Weighted average number of common shares outstanding, assuming dilution
(millions of shares)
  
 
664.4
 
   725.8   
 
668.1
 
   730.8  
Net income (loss) per common share
(dollars)
  
 
3.63
 
   0.50   
 
5.36
 
   1.04 
Dividends per common share - declared
(dollars)
  
 
0.34
 
   0.27   
 
0.68
 
   0.49 
 
    Three Months
    to March 31
 20232022
Net income (loss) per common share – basic
Net income (loss) (millions of Canadian dollars)
1,2481,173
Weighted average number of common shares outstanding (millions of shares)
584.2670.5
Net income (loss) per common share (dollars)
2.141.75
Net income (loss) per common share – diluted
Net income (loss) (millions of Canadian dollars)
1,2481,173
Weighted average number of common shares outstanding (millions of shares)
584.2670.5
Effect of employee share-based awards (millions of shares)
1.21.4
Weighted-average number of common shares outstanding,
        assuming dilution (millions of shares)
585.4671.9
Net income (loss) per common share (dollars)
2.131.75
Dividends per common share – declared (dollars)
0.440.34
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
10. Other comprehensive income (loss) information

Changes in accumulated other comprehensive income (loss):
millions of Canadian dollars2023 2022 
Balance at January 1(512)(1,177)
Postretirement benefits liability adjustment:
Current period change excluding amounts reclassified
       from accumulated other comprehensive income
21 24 
Amounts reclassified from accumulated other comprehensive income10 21 
Balance at March 31(481)(1,132)
Amounts reclassified out of accumulated other comprehensive income (loss) - before-tax income (expense):
 
        Three Months
       to March 31
millions of Canadian dollars2023 2022 
Amortization of postretirement benefits liability adjustment
       included in net benefit cost (a)
(13)(28)
(a) This accumulated other comprehensive income component is included in the computation of net benefit cost (note 4).

Income tax expense (credit) for components of other comprehensive income (loss):
     Three Months
      to March 31
millions of Canadian dollars2023 2022 
Postretirement benefits liability adjustments:
Postretirement benefits liability adjustment (excluding amortization)7 8 
Amortization of postretirement benefits liability adjustment
       included in net benefit cost
3 7 
Total10 15 

millions of Canadian dollars
  
 
    2022
 

 2021 
Balance at January 1  
 
(1,177
) 
    (1,989) 
Postretirement benefits liability adjustment:            
Current period change excluding amounts reclassified from accumulated other comprehensive income  
 
24
 
     54 
Amounts reclassified from accumulated other comprehensive income  
 
42
 
     66 
 Balance at June 30  
 
(1,111
) 
   (1,869) 
  Amounts reclassified out of accumulated other comprehensive income (loss) -
before-tax
income (expense):
             Six Months  
    Second Quarter    to June 30  
millions of Canadian dollars
  
 
2022
 
  2021    
 
    2022
 
   2021  
Amortization of postretirement benefits liability adjustment included in net benefit cost
(a)
  
 
(27
) 
  (44)  
 
(55)
 
  (88)  
(a) This accumulated other comprehensive income component is included in the computation of net benefit cost (note 4).
Income tax expense (credit) for components of other comprehensive income (loss):
              Six Months 
    Second Quarter    to June 30 
millions of Canadian dollars
  
 
2022
 
   2021   
 
    2022
 
   2021 
Postretirement benefits liability adjustments:
                    
Postretirement benefits liability adjustment (excluding amortization)  
 
-
 
   -   
 
8
 
   17 
Amortization of postretirement benefits liability adjustment included in net benefit cost  
 
6
 
   11   
 
13
 
   22 
     
Total  
 
6
 
   11   
 
21
 
   39  
11. Divestment activities
Jointly with ExxonMobil Canada, Imperial signed an agreement in the second quarter with Whitecap Resources Inc. for the sale of its interests in XTO Energy Canada which include assets in the Montney and Duvernay areas of central Alberta, for approximately $1.9 billion ($0.9 billion Imperial’s share), subject to working capital and other adjustments. The transaction is expected to close prior to the end of the third quarter of 2022, subject to regulatory approvals. Imperial’s net assets held for sale associated with this transaction include about $0.9 billion of total assets (about $0.8 billion of property, plant and equipment) and about $0.1 billion total liabilities in the Upstream segment. The company estimates that total cash flow from the divestment will be approximately $0.9 billion, and expects to recognize a gain at closing of approximately $0.2 billion. Estimated gain and net cash flow could change due to market factors, working capital adjustments, tax impacts and closing dates.
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IMPERIAL OIL LIMITED
Item 2. Management’s discussion and analysis of Contents
IMPERIAL OIL LIMITED
Item 2.
Management’s discussion and analysis of financial condition and results of operations
Non-GAAP
financial measures and other specified financial measures
Certain measures included in this document are not prescribed by U.S. Generally Accepted Accounting Principles (GAAP). These measures constitute
“non-GAAP
“non-GAAP financial measures” under Securities and Exchange Commission Regulation G and Item 10(e) of Regulation S-K, and “specified financial measures” under National Instrument
52-112
Non-GAAP
and Other Financial Measures Disclosure
of the Canadian Securities Administrators.

Reconciliation of these
non-GAAP
financial measures to the most comparable GAAP measure, and other information required by these regulations, have been provided.
Non-GAAP
financial measures and specified financial measures are not standardized financial measures under GAAP and do not have a standardized definition. As such, these measures may not be directly comparable to measures presented by other companies, and should not be considered a substitute for GAAP financial measures.
Net income (loss) excluding identified items
Net income (loss) excluding identified items is a
non-GAAP
financial measure that is total net income (loss) excluding individually significant
non-operational
events with an absolute corporate total earnings impact of at least $100 million in a given quarter. The net income (loss) impact of an identified item for an individual segment in a given quarter may be less than $100 million when the item impacts several segments or several periods. The most directly comparable financial measure that is disclosed in the financial statements is net"Net income (loss)" within the company’s Consolidated statement of income. Management uses these figures to improve comparability of the underlying business across multiple periods by isolating and removing significant
non-operational
events from business results. The company believes this view provides investors increased transparency into business results and trends, and provides investors with a view of the business as seen through the eyes of management. Net income (loss) excluding identified items is not meant to be viewed in isolation or as a substitute for net income (loss) as prepared in accordance with U.S. GAAP. All identified items are presented on an
after-tax
basis.
Reconciliation of net income (loss) excluding identified items
There were no identified items in the secondfirst quarter or
year-to-date
2022of 2023 and 2021.2022.
20
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
CurrentRecent business environment

During the
COVID-19
pandemic, industry investment to maintain and increase production capacity was restrained to preserve capital, resulting in underinvestment and supply tightness as demand for petroleum and petrochemical products recovered. Across late 2021 and first quarter of 2023, the first half of 2022, this dynamic, along with supply chain constraints and a continuation of demand recovery, led to a steady increase in oil and natural gas prices and refining margins. In the first half of 2022, tightness in the oil and natural gas markets was further exacerbated by Russia’s invasion of Ukraine and subsequent sanctions imposed upon business and other activities in Russia. The price of crude oil and certain regional natural gas indicators increased todecreased as the global oil market saw higher inventory levels. The increase in inventory levels not seen for several years. By the end ofwas followed by announcements early in the second quarter of decreased production in certain key oil-producing countries. In addition, the Canadian WTI/WCS spread continued to widen in January and February before beginning to recover in March. Refining margins remained high prices had leddue to a temperinglow inventory levels of demand for somepetroleum products. Commodity and product prices are expected to remain volatile given the current global economic and geopolitical uncertainty affecting supply and demand.
Operating results
SecondFirst quarter 2023 vs. first quarter 2022 vs. second quarter 2021
         First Quarter
millions of Canadian dollars, unless noted20232022
Net income (loss) (U.S. GAAP)1,2481,173
Net income (loss) per common share, assuming dilution (dollars)2.131.75
   Second Quarter 
millions of Canadian dollars, unless noted
  
 
2022
 
               2021  
Net income (loss) (U.S. GAAP)
  
 
2,409
 
   366  
Net income (loss) per common share, assuming dilution
(dollars)
  
 
3.63
 
   0.50  
Upstream
Net income (loss) factor analysis
millions of Canadian dollars
78

Price – HigherLower bitumen realizations were generally in line with increases inprimarily driven by lower marker prices driven primarily by increased demand and supply chain constraints.the widening WTI/WCS spread. Average bitumen realizations increaseddecreased by $55.01$39.03 per barrel, generally in line with WCS, and synthetic crude oil realizations increaseddecreased by $63.87$14.79 per barrel, generally in line with WTI.

Volumes – Higher volumes were primarily driven by the timingabsence of turnaround activities at Syncrude, partially offset byextreme cold weather, and reduced unplanned downtime at Kearl.
Kearl as a result of the successful rollout of the winterization strategy.

Royalty – HigherLower royalties primarily driven by improvedweakened commodity prices.

Other – Includes higher operating expenses of about $180 million, primarily higher energy prices, partially offset by favourable foreign exchange impacts of about $60$150 million, partly offset by higher operating expenses of about $80 million.

Marker prices and average realizations
   Second Quarter         First Quarter
Canadian dollars, unless noted
  
 
2022
 
   2021 Canadian dollars, unless noted2023 2022 
West Texas Intermediate (US$ per barrel)
  
 
108.52
 
           66.17 
West Texas Intermediate (US$ per barrel)
75.98 95.01 
Western Canada Select (US$ per barrel)
  
 
95.80
 
   54.64  
Western Canada Select (US$ per barrel)
51.42 80.46 
WTI/WCS Spread (US$ per barrel)
  
 
12.72
 
   11.53 
WTI/WCS Spread (US$ per barrel)
24.56 14.55 
Bitumen
(per barrel)
  
 
112.27
 
   57.26 
Bitumen (per barrel)
50.33 89.36 
Synthetic crude oil
(per barrel)
  
 
144.67
 
   80.80 
Synthetic crude oil (per barrel)
102.45 117.24 
Average foreign exchange rate (US$)
  
 
0.78
 
   0.81 
Average foreign exchange rate (US$)
0.74 0.79 
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
Production
       First Quarter
thousands of barrels per day2023 2022 
Kearl (Imperial's share)
184 132 
Cold Lake141 140 
Syncrude (a)
76 77 
Kearl total gross production (thousands of barrels per day)
259 186 
(a) In the first quarter of 2023, Syncrude gross production included about 2 thousand barrels per day of bitumen and other products (2022 - 2 thousand barrels per day) that were exported to the operator's facilities using an existing interconnect pipeline.

Production
    Second Quarter 
thousands of barrels per day
  
 
2022
 
           2021 
Kearl
(Imperial’s share)
  
 
159
 
   181 
Cold Lake
  
 
144
 
   142 
Syncrude
(a)
  
 
81
 
   47 
           
Kearl total gross production
(thousands of barrels per day)
  
 
224
 
   255 
(a) In the second quarter of 2022, Syncrude gross production included about 2 thousand barrels per day of bitumen (2021 - rounded to 0 thousand barrels per day) that was exported to the operator’s facilities using an existing interconnect pipeline.
LowerHigher production at Kearl was primarily a resultdriven by the absence of downtime.
Higher production at Syncrude was primarilyextreme cold weather, and reduced unplanned downtime as a result of the timingsuccessful rollout of turnaround activities.
the winterization strategy.
Downstream
Net income (loss) factor analysis
millions of Canadian dollars
81

Margins – Higher margins primarily reflect improved market conditions.

Other – Includes lower turnaroundImproved volumes of about $90 million and favourable foreign exchange impacts of about $130 million, reflecting the absence of turnaround activities at Strathcona refinery, partially offset by higher operating expenses of about $70 million, primarily higher energy costs.
$80 million.

Refinery utilization and petroleum product sales
 
    Second Quarter 
thousands of barrels per day, unless noted
  
 
2022
 
             2021 
Refinery throughput
  
 
412
 
   332  
Refinery capacity utilization
(percent)
  
 
96
 
   78 
Petroleum product sales
  
 
480
 
   429 
Refinery utilization and petroleum product sales
        First Quarter
thousands of barrels per day, unless noted2023 2022 
Refinery throughput417 399 
Refinery capacity utilization (percent)
96 93 
Petroleum product sales455 447 
Improved refinery throughput in the secondfirst quarter of 20222023 was primarily driven by reduced turnaround activity and increased demand.
lower planned maintenance.
Improved petroleum product sales in the second quarter of 2022 were mainly due to increased demand.
Chemicals
Net income (loss) factor analysis
millions of Canadian dollars
80

22
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IMPERIAL OIL LIMITED
Corporate and other
         First Quarter
millions of Canadian dollars2023 2022 
Net income (loss) (U.S. GAAP)
(5)(54)
    Second Quarter 
millions of Canadian dollars
  
 
2022  
 
           2021  
Net income (loss) (U.S. GAAP)
  
 
    (23) 
 
        (50) 
Liquidity and capital resources
        First Quarter
millions of Canadian dollars2023 2022 
Cash flow generated from (used in):  
Operating activities(821)1,914 
Investing activities(414)(279)
Financing activities(271)(639)
Increase (decrease) in cash and cash equivalents(1,506)996 
Cash and cash equivalents at period end2,243 3,149 

                               
    Second Quarter 
millions of Canadian dollars
  
 
2022
 
          2021 
Cash flow generated from (used in):
         
Operating activities
  
 
2,682
 
  852 
Investing activities
  
 
(230
) 
  (207) 
Financing activities
  
 
(2,734
) 
  (1,336) 
Increase (decrease) in cash and cash equivalents
  
 
(282
) 
  (691) 
   
Cash and cash equivalents at period end
  
 
2,867
 
  776 
Cash flow generated fromused in operating activities primarily reflects higherunfavourable working capital impacts including, an income tax catch-up payment of $2.1 billion and lower Upstream realizations, andpartly offset by improved Downstream margins.

Cash flow used in investing activities primarily reflects higher additions to property, plant and equipment.

Cash flow used in financing activities primarily reflects:
   
      
   
      
 
    Second Quarter 
millions of Canadian dollars, unless noted
  
 
2022 
 
           2021 
Dividends paid
  
 
228 
 
   161 
Per share dividend paid
(dollars)
  
 
0.34 
 
     0.22  
Share repurchases
(a)
  
 
2,500 
 
   1,171 
Number of shares purchased
(millions)
(a)
  
 
32.5 
 
   29.5 
(a) Share repurchases were made under the company’s substantial issuer bid that commenced on May 6, 2022 and expired on June 10, 2022. Includes shares purchased from Exxon Mobil Corporation by way of a proportionate tender to maintain its ownership percentage at approximately 69.6 percent.
 
        First Quarter
millions of Canadian dollars, unless noted2023 2022 
Dividends paid266 185 
Per share dividend paid (dollars)
0.44 0.27 
Share repurchases (a)
— 449 
  Number of shares purchased (millions) (a)
— 8.9 
(a)The company did not purchase shares during the first quarter of 2023. In the first quarter of 2022, share repurchases were made under the company's normal course issuer bid program, and included shares purchased from Exxon Mobil Corporation concurrent with, but outside of, the normal course issuer bid.

On May 6, 2022,Contractual obligations

In the second quarter of 2023, the company commencedentered into a substantial issuer bid pursuant to which it offered tolong-term purchase agreement with a third party for cancellation up to $2.5 billion of its common shares through a modified Dutch auctionabout $3billion. It has no impact on the 2023 and proportionate tender offer. The substantial issuer bid was completed2024 obligations disclosed in Imperial's 2022 annual report on June 15, 2022, with the company taking up and paying for 32,467,532 common shares at a price of $77.00 per share, for an aggregate purchase of $2.5 billion and 4.9 percent of Imperial’s issued and outstanding shares as the close of business on May 2, 2022. This included 22,597,379 shares purchased from Exxon Mobil Corporation by way of a proportionate tender to maintain its ownership percentage at approximately 69.6 percent.
On June 27, 2022, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid and will continue its existing share purchase program. The program enables the company to purchase up to a maximum of 31,833,809 common shares during the period June 29, 2022 to June 28, 2023. This maximum includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent. The program will end should the company purchase the maximum allowable number of shares, or on June 28, 2023. Imperial plans to accelerate its share purchases under the normal course issuer bid program, and anticipates repurchasing all remaining allowable shares by the end of October 2022. Purchase plans may be modified at any time without prior notice.
In June 2022, the company reduced its existing $500 million committed long-term line of credit to $250 million and extended the maturity date to June 30, 2023.Form 10-K. The company also extended one of its $250 million committed long-term lines of credit to June 30, 2024. The company hasdoes not drawnbelieve that the increased obligation will have a material effect on any of its outstanding $750 million of available credit facilities.
Imperial's operations, financial condition or financial statements.
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IMPERIAL OIL LIMITED
Six months 2022 vs. six months 2021
    Six Months 
millions of Canadian dollars, unless noted
  
 
2022
 
             2021 
Net income
(loss) (U.S. GAAP)
  
 
3,582
 
   758 
Net income (loss) per common share, assuming dilution
(dollars)
  
 
5.36
 
     1.04  

Upstream
IMPERIAL OIL LIMITED
Net income (loss) factor analysis
millions of Canadian dollars
Price – Higher realizations were generally in line with increases in marker prices, driven primarily by increased demand and supply chain constraints. Average bitumen realizations increased by $49.08 per barrel generally in line with WCS, and synthetic crude oil realizations increased by $58.99 per barrel generally in line with WTI.
Volumes – Lower volumes primarily driven by downtime at Kearl, partially offset by the timing of turnaround activities at Syncrude.
Royalty – Higher royalties primarily driven by improved commodity prices.
Other – Includes higher operating expenses of about $220 million, primarily higher energy prices, partially offset by favourable foreign exchange impacts of about $60 million.
Average realizations and marker prices
    Six Months 
Canadian dollars, unless noted
  
 
2022
 
             2021 
West Texas Intermediate
(US$ per barrel)
  
 
101.77
 
   62.22 
Western Canada Select
(US$ per barrel)
  
 
88.13
 
   50.14 
WTI/WCS Spread
(US$ per barrel)
  
 
13.64
 
   12.08 
Bitumen
(per barrel)
  
 
101.53
 
   52.45 
Synthetic crude oil
(per barrel)
  
 
131.41
 
   72.42 
Average foreign exchange rate
(US$)
  
 
0.79
 
   0.80 
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IMPERIAL OIL LIMITED
Production
    Six Months 
thousands of barrels per day
  
 
2022
 
           2021 
Kearl
(Imperial’s share)
  
 
146
 
   180 
Cold Lake
  
 
142
 
   141 
Syncrude
(a)
  
 
79
 
   63 
           
Kearl total gross production
(thousands of barrels per day)
  
 
205
 
   253 
(a) In 2022, Syncrude gross production included about 2 thousand barrels per day of bitumen (2021 - rounded to 0 thousand barrels per day) that was exported to the operator’s facilities using an existing interconnect pipeline.
Lower production at Kearl was primarily a result of downtime.
Higher production at Syncrude was primarily a result of the timing of turnaround activities.
Downstream
Net income (loss) factor analysis
millions of Canadian dollars
Margins – Higher margins primarily reflect improved market conditions.
Other – Includes lower turnaround impacts of about $130 million, reflecting the absence of turnaround activities at Strathcona refinery, partially offset by higher operating expenses of about $90 million, primarily higher energy costs.
Refinery utilization and petroleum product sales
 
    Six Months 
thousands of barrels per day, unless noted
  
 
2022
 
             2021 
Refinery throughput
  
 
406
 
   348 
Refinery capacity utilization
(percent)
  
 
95
 
   81 
Petroleum product sales
  
 
464
 
   421 
Improved refinery throughput in 2022 was primarily driven by reduced turnaround activity and increased demand.
Improved petroleum product sales in 2022 primarily reflects increased demand.
Chemicals
Net income (loss) factor analysis
millions of Canadian dollars
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IMPERIAL OIL LIMITED
Corporate and other
   Six Months 
millions of Canadian dollars
  
 
2022
 
           2021 
Net income (loss) (U.S. GAAP)
  
 
(77)
 
        (96) 
Liquidity and capital resources
   Six Months 
millions of Canadian dollars
  
 
2022
 
          2021 
Cash flow generated from (used in):
   
Operating activities
  
 
4,596
 
  1,897 
Investing activities
  
 
(509
) 
  (354) 
Financing activities
  
 
(3,373
) 
  (1,538) 
Increase (decrease) in cash and cash equivalents
  
 
714
 
  5 
Cash flow generated from operating activities primarily reflects higher Upstream realizations, improved Downstream margins and favourable working capital impacts.
Cash flow used in investing activities primarily reflects higher additions to property, plant and equipment.
Cash flow used in financing activities primarily reflects:
   Six Months 
millions of Canadian dollars, unless noted
  
 
2022
 
           2021 
Dividends paid
  
 
413
 
   323 
Per share dividend paid
(dollars)
  
 
0.61
 
     0.44  
Share repurchases
(a)
  
 
2,949
 
   1,171 
Number of shares purchased
(millions) (a)
  
 
41.4
 
   29.5 
(a) Share repurchases were made under the company’s normal course issuer bid program and substantial issuer bid that commenced on May 6, 2022 and expired on June 10, 2022. Includes shares purchased from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid, and by way of a proportionate tender under the company’s substantial issuer bid.
 
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IMPERIAL OIL LIMITED
Forward-looking statements

Statements of future events or conditions in this report, including projections, targets, expectations, estimates, and business plans are forward-looking statements. Forward-looking statements can be identified by words such as believe, anticipate, intend, propose, plan, goal, seek, project, predict, target, estimate, expect, strategy, outlook, schedule, future, continue, likely, may, should, will and similar references to future periods. Forward-looking statements in this release include, but are not limited to, references to the use of derivative instruments and effectiveness of risk mitigation; purchases under the normal course issuer bid, including planscompany’s belief that the commitment related to accelerate completion bylong-term purchase agreement will not have a material adverse effect on the end of October 2022; the sale of XTO Energy Canada and expected closing timing, adjustments and estimated cash flow and gain; and the expectation of commodity and product price volatility.company.

Forward-looking statements are based on the company’scompany's current expectations, estimates, projections and assumptions at the time the statements are made. Actual future financial and operating results, including expectations and assumptions concerning demand growth and energy source, supply and mix; production rates, growth and mix; for shareholder returns, assumptions such as cash flow forecasts, financing sources and capital structure; project plans, timing, costs, technical evaluations and capacities and the company’s ability to effectively execute on these plans and operate its assets; for shareholder returns, assumptions such as cash flow forecasts, financing sources and capital structure, participation of the company’s majority shareholder and the results of periodic and ongoing evaluation of alternate uses of capital; capital and environmental expenditures; that regulatory approvals related to the sale of XTO Energy Canada will be received in a timely manner and the sale will close as anticipated; the adoption and impact of new facilities or technologies on reductions to GHG emissions intensity; receipt of regulatory approvals; applicable laws and government policies, including with respect to climate change and GHG emissions reductions; progression of
COVID-19
and its impacts on Imperial’s ability to operate its assets; and commodity prices, foreign exchange rates and general market conditions could differ materially depending on a number of factors.

These factors include global, regional or local changes in supply and demand for oil, natural gas, and petroleum and petrochemical products and resulting price, differential and margin impacts, including foreign government action with respect to supply levels and prices, the impact of
COVID-19
on demand and the occurrence of wars; availability and allocation of capital; unanticipated technical or operational difficulties; operational hazards and risks; the receipt, in a timely manner, of regulatory and third-party approvals; project management and schedules and timely completion of projects; management effectiveness and disaster response preparedness, including business continuity plans in response to
COVID-19;
unanticipated technical or operational difficulties; availability and performance of third-party service providers, including in light of restrictions related to
COVID-19;
the results of research programs and new technologies, and ability to bring new technologies to commercial scale on a cost-competitive basis;providers; environmental risks inherent in oil and gas exploration and production activities; political or regulatory events, including changes in law or government policy such as tax laws, production curtailmentpolicy; management effectiveness and actions indisaster response to
COVID-19;
preparedness; operational hazards and risks; cybersecurity incidents, including increased reliance on remote working arrangements; currency exchange rates; general economic conditions; and other factors discussed in Item 1A risk factors and Item 7 management’s discussion and analysis of financial condition and results of operations of Imperial Oil Limited’s most recent annual report on Form
10-K
and subsequent interim reports.

Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to Imperial. Imperial’s actual results may differ materially from those expressed or implied by its forward-looking statements and readers are cautioned not to place undue reliance on them. Imperial undertakes no obligation to update any forward-looking statements contained herein, except as required by applicable law.

The term “project”"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.
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IMPERIAL OIL LIMITED
Item 3. Quantitative and qualitative disclosures about market risk
Information about market risks for the six months ended June 30, 2022, does not differ materially from that discussed on page 33 of the company’s annual report on Form
10-K
Information about market risks for the three months ended March 31, 2023, does not differ materially from that discussed on page 32 of the company’s annual report on Form 10-K for the year ended December 31, 2021 and on page 23 of the Form 10-Q for the quarter ended March 31, 2022.
Item 4. Controls and procedures
As indicated in the certifications in Exhibit 31 of this report, the company’s principal executive officer and principal financial officer have evaluated the company’s disclosure controls and procedures as of June 30, 2022.March 31, 2023. Based on that evaluation, these officers have concluded that the company’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by the company 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 has not been any change in the company’s internal control over financial reporting during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting.
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IMPERIAL OIL LIMITED
PART II. OTHER INFORMATION
Item 1. Legal proceedings
Imperial has elected to use a US $1 million threshold for disclosing environmental proceedings.
Item 2. Unregistered sales of equity securities and use of proceeds
Issuer purchases of equity securities
    
Total number of
shares purchased		 
 		   

Average price paid
per share
(Canadian dollars)
 
 
 
   



Total number of
shares purchased
as part of publicly
announced plans
or programs		 
 
 
 
 		   



Maximum number
of shares that may
yet be purchased
under the plans or
programs (a) (b) (c)		 
 
 
 
 
April 2022
  
 
-
 
  
 
-
 
  
 
-
 
  
 
-
 
(April 1 - April 30)
        
May 2022
  
 
-
 
  
 
-
 
  
 
-
 
  
 
-
 
(May 1 - May 31)
        
June 2022
  
 
32,467,532
 
  
 
77.00
 
  
 
32,467,532
 
  
 
-
 
(June 1 - June 28)
        
(June 29 - June 30)
  
 
-
 
  
 
-
 
  
 
-
 
  
 
31,833,809
 
(a)
Total number of
On June 23, 2021, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a normal course issuer bid to continue its existing share purchase program. The program enabled the company to purchase up to a maximum of 35,583,671 common shares during the period June 29, 2021 to June 28, 2022. This maximum included shares purchased
Average price paid
per share
(Canadian dollars)
Total number of
shares purchased
as part of publicly
announced plans
or programs
Maximum number
of shares that may
yet be purchased
under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. Exxon Mobil Corporation participated to maintain its ownership percentage at approximately 69.6 percent. The program ended on plans or
programs (a)
January 31, 2022 as a result of the company purchasing the maximum allowable number of shares under the program.2023
(January 1 - January 31)————
February 2023
(February 1 - February 28)————
March 2023
(March 1 - March 31)————
(b)
On June 27, 2022, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid and will(a)On June 27, 2022, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid and to continue its existing share purchase program. The program enables the company to purchase up to a maximum of 31,833,809 common shares during the period June 29, 2022 to June 28, 2023. This maximum includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent. The program will end should the company purchase the maximum allowable number of shares, or on June 28, 2023. Imperial plans to accelerate its share purchases under the normal course issuer bid program and anticipates repurchasing all remaining allowable shares by the end of October 2022.
(c)
On May 6, 2022, the company commenced a substantial issuer bid pursuant to which it offered to purchase for cancellation up to $2.5 billion of its common shares through a modified Dutch auction and proportionate tender offer. The substantial issuer bid was completed on June 15, 2022, with the company taking up and paying for 32,467,532 common shares at a price of $77.00 per share, for an aggregate purchase of $2.5 billion and 4.9 percent of Imperial’s issued and outstanding shares as the close of business on May 2, 2022. This included 22,597,379 shares purchased from Exxon Mobil Corporation by way of a proportionate tender to maintain its ownership percentage at approximately 69.6 percent.
The company will continue to evaluate its share purchase program. The program enabled the company to purchase up to a maximum of 31,833,809 common shares during the period June 29, 2022 to June 28, 2023. This maximum included shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the contextpast, Exxon Mobil Corporation advised the company that it intended to participate to maintain its ownership percentage at approximately 69.6 percent. The program ended on October 21, 2022 as a result of its overall capital activities. Purchase plans may be modified at any time without prior notice.the company purchasing the maximum allowable number of shares under the program.

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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
Item 6. Exhibits
Item 6.
Exhibits
(31.1) Certification by the principal executive officer of the company pursuant to Rule
13a-14(a).
(31.2) Certification by the principal financial officer of the company pursuant to Rule
13a-14(a).
(32.1) Certification by the chief executive officer of the company pursuant to Rule
13a-14(b)
and 18 U.S.C. Section 1350.
(32.2) Certification by the chief financial officer of the company pursuant to Rule
13a-14(b)
and 18 U.S.C. Section 1350.
(101) Interactive Data Files (formatted as Inline XBRL).
(104) Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
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IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
SIGNATURES
SIGNATURES
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.

Imperial Oil Limited
(Registrant)
Date:August 3, 2022
/s/ Daniel E. Lyons
(Registrant)
Date:May 2, 2023(Signature)/s/ Daniel E. Lyons
(Signature)
Daniel E. Lyons
Senior vice-president, finance and
administration, and controller
administration, and controller
(Principal accounting officer)
Date:August 3, 2022
/s/ Cathryn Walker
(Signature)(Principal accounting officer)
Date:May 2, 2023/s/ Cathryn Walker
(Signature)
Cathryn Walker
Assistant corporate secretary
3125