ITEM 3. LEGAL PROCEEDINGS

ExxonMobil has elected to use a $1 million threshold for disclosing environmental proceedings.

As reported in the Corporation's Form 10-Q for the third quarter of 2024, XTO Energy, Inc. (XTO) received a Notice of Violation from the United States Environmental Protection Agency (EPA) on March 9, 2022 regarding certain well pad production facility sites in Butler County, Pennsylvania, alleging violations of certain federal New Source Performance Standards (NSPS) and Pennsylvania's Title V operating permit regulations. In October 2024, XTO entered into a consent decree with the Department of Justice (DOJ) and the Department of Environmental Protection of Pennsylvania to resolve these alleged violations upon payment of a $4.0 million penalty. On December 13, 2024, the United States District Court for the Western District of Pennsylvania entered the consent decree, and XTO paid the civil penalty of $4.0 million.

As reported in the Corporation's Form 10-Q for the first quarter of 2024, on August 4, 2022, XTO received a letter from the DOJ notifying XTO of the EPA's request to initiate a potential civil action against XTO regarding the Schnegg well in Powhatan Point, Ohio. The EPA alleged XTO breached its duty under the General Duty Clause of the Clean Air Act for the Schnegg well, and such breaches resulted in the 2018 well blowout. In December 2024, XTO signed a consent decree with the DOJ to resolve these alleged violations upon payment of an $8.0 million penalty, which XTO intends to pay in March 2025.

As reported in the Corporation's Form 10-Q for the first quarter of 2023, ExxonMobil appealed to the U.S. Court of Appeals for the Fifth Circuit a judgment of the United States District Court for the Southern District of Texas (Texas District Court) entered on April 26, 2017, in a citizen suit captioned Environment Texas Citizen Lobby, Inc. et al. v. Exxon Mobil Corporation, relating to alleged Clean Air Act and other violations at the Baytown complex. The Texas District Court had awarded approximately $20 million in civil penalties, payable to the United States Treasury. On July 29, 2020, the Fifth Circuit vacated the Texas District Court's penalty award and remanded the case back to the Texas District Court for further proceedings. On March 2, 2021, the Texas District Court awarded $14.25 million in civil penalties, payable to the United States Treasury. ExxonMobil filed its appeal of the judgment in the U.S. Court of Appeals for the Fifth Circuit on April 12, 2021. On August 30, 2022, the Fifth Circuit affirmed the Texas District Court's revised penalty award of $14.25 million. On February 17, 2023, the Fifth Circuit granted ExxonMobil's motion for rehearing en banc. On December 11, 2024, the Fifth Circuit affirmed the Texas District Court's judgment assessing a $14.25 million penalty against ExxonMobil. ExxonMobil is continuing to evaluate its available options, including seeking review in the U.S. Supreme Court.

Refer to the relevant portions of Note 16 of the Financial Section of this report for additional information on legal proceedings.