Citing current and former employees, the Journal reported in September 2020 that some staff assigned to the

Permian,

the most active U.S. oil field, thought Exxon had been overly optimistic about an earlier projection it could increase oil and gas production in the New Mexico and West Texas region to 1 million barrels of oil equivalent per day as early as 2024. The people told the Journal that Exxon had overestimated how quickly it could drill wells there, which they said led the company to overvalue the asset by billions of dollars.

Exxon denied the allegations at the time and has repeatedly said it has met and exceeded its drilling targets.

“The speed the employees claimed was impossible, was not only possible, but we achieved that speed three years ahead of the plan they questioned,” Exxon spokesman

Casey Norton

said Friday.

Exxon later fired two scientists. The Labor Department determined the firings were prompted by Exxon’s suspicions the pair had brought information to the Journal. It said Exxon claimed it had fired one of the scientists for mishandling proprietary information and another for “a negative attitude,” job hunting and losing management’s confidence.

“

Exxon Mobil’s

actions are unacceptable,”

Doug Parker,

Assistant Secretary of Labor for Occupational Safety and Health, said in a statement. “OSHA will aggressively protect the rights of employees who raise concerns related to financial improprieties or potential fraud against shareholders.”

Mr. Norton said the company rejected the claims made by the two scientists and will appeal the Labor Department’s findings.

“The terminations in late 2020 were unrelated to the ill-founded concerns raised by the employees in 2019,” he said.

The Labor Department said it determined that communications with media related to alleged company violations are protected activity under the federal Sarbanes-Oxley Act.

In a subsequent article in early 2021, the Journal reported the Securities and Exchange Commission launched an investigation following an employee’s whistleblower complaint alleging the company’s overvaluation of the Permian had misled investors. The agency earlier this year closed the investigation and said it would not recommend an enforcement action against Exxon.

A federal judge in Texas dismissed a lawsuit last week brought by Exxon shareholders alleging the company misled investors about the value of its Permian assets. The judge determined the plaintiffs had not shown enough evidence that Exxon executives deliberately defrauded investors. The judge said they can refile the complaint with additional evidence.

Exxon says it is meeting its drilling targets in the Permian. It reduced the number of drilling rigs it operates there following the onset of the pandemic and a historic drop in oil prices. As a result of operating fewer rigs, Exxon says it now aims to increase production in the Permian to over 800,000 barrels of oil equivalent per day by 2027, up from more than 550,000 barrels per day this year, according to a March presentation.

Write to Collin Eaton at collin.eaton@wsj.com