Exxon Mobil Corporation (NYSE:XOM) is the ultimate blue chip stock in the oil patch, but even it hasn’t been spared the carnage of what’s being called the worst oil crash in nearly 50 years (1).
So naturally, many conservative investors living off dividends are wondering how safe this legendary oil giant’s dividend really is.
Let’s take a look at why, and how, Exxon plans to ride out this oil storm, and not just maintain the current payout, but also continue growing it as it has for over a third of a century.
Business Description
ExxonMobil is the world’s largest publicly traded integrated oil company, meaning it profits from extracting value from every stage of oil production, refinement, and transformation into specialty petrochemicals.
Source: ExxonMobil Investor Presentation
During the first half of 2016 the company produced the equivalent of just over 4.1 million barrels per day of oil, 58.8% of that in the form of higher margin liquids, such as crude oil, and the remainder in the form of natural gas. To put that in perspective, if Exxon were a nation, it would be the fifth largest oil producer on earth; ahead of Canada, Iran, Kuwait, the UAE, and Venezuela.
Source: US Energy Information Administration
What’s more, with 25 billion barrels of proven oil reserves, Exxon would hold the 14th largest reserves of any nation on earth; more than Mexico, and Brazil combined.
Source: CIA World Factbook
