Chevron Corporation has reported earnings of US$2.7 billion (US$1.41 per share – diluted) for first quarter 2017 (1Q17), compared with a loss of US$725 million (US$0.39 per share – diluted) in the 2016 first quarter (1Q16). Included in the quarter was a gain of approximately US$600 million from the sale of an upstream asset. Foreign currency effects decreased earnings in 1Q17 by US$241 million, compared with a decrease of US$319 million a year earlier. Sales and other operating revenues in first quarter 2017 were US$32 billion, compared to US$23 billion in the year-ago period.
“First quarter earnings and cash flow improved significantly from a year ago,” said Chairman and CEO John Watson. “We benefitted from increasing crude oil prices and ongoing efficiencies being implemented across the company...We continue to make good progress on reducing our spend,” Watson added. “Our operating expenses were reduced by about 14% from 1Q16 and our capital spending declined over 30% from a year ago. We started up several new projects and have all three trains at Gorgon online. We also progressed our asset sales programme. The combination of these actions contributed to a cash positive first quarter...Overall net oil-equivalent production in the first quarter increased 3% compared to the 2016 full year and we are on track to meet the 4 - 9% growth goal for 2017 before the effect of asset sales,” Watson added.
Recent company milestones include:
- Angola – Commenced production from the main production facility of the Mafumeira Sul Project.
- Australia – Achieved first LNG from Train 3 at the Gorgon Project.
- Bangladesh – Announced agreement to sell upstream operations.
- Canada – Signed agreement to sell refining and marketing assets in British Columbia and Alberta.
- Indonesia – Completed the sale of the geothermal business.
- South Africa and Botswana – Signed agreement to sell refining, fuels and lubricants assets.
US downstream operations earned US$469 million in 1Q17, compared with earnings of US$247 million a year earlier. The increase was primarily due to the absence of a 1Q16 asset impairment, lower operating expenses as a result of decreased planned turnaround activity, and higher margins on refined product sales.
Refinery crude oil input in 1Q17 decreased 5% to 912 000 bpd from the year-ago period. Refined product sales of 1.15 million bpd decreased 5% from 1Q16. Branded gasoline sales of 511 000 bpd were essentially unchanged from the 2016 period. Both refinery crude oil input and refined product sales were down due to divestment of the Hawaii refining and marketing assets.
International downstream operations earned US$457 million in 1Q17, compared with US$488 million a year earlier. The decrease was primarily due to lower margins on refined product sales. Foreign currency effects decreased earnings by US$46 million in 1Q17, compared with a decrease of US$48 million a year earlier.
Refinery crude oil input of 753 000 bpd in 1Q17 decreased 42 000 bpd from the year-ago period, mainly due to planned turnaround activity at the company’s refinery in Cape Town, South Africa.
Refined product sales of 1.45 million bpd in 1Q17 increased 1% from the year-ago period due to higher gas oil and fuel oil sales, partially offset by lower gasoline sales.
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