Chevron reports $500 million Q2 net income loss over 2011
SAN RAMON, Calif. -- Chevron Corporation (NYSE: CVX) today reported earnings of $7.2 billion ($3.66 per share – diluted) for the second quarter 2012, compared with $7.7 billion ($3.85 per share – diluted) in the 2011 second quarter.
Sales and other operating revenues in the second quarter 2012 were $60 billion, compared to $67 billion in the year-ago period.
“Our second quarter earnings and cash flow were among our strongest ever, even with softer oil markets,” said Chairman and CEO John Watson. “Despite current weakness in the global economy, we continue to invest in our long-term growth projects to help deliver affordable energy to meet future demand. We took several important steps to advance our major upstream capital projects, in particular achieving milestones in our natural gas development projects in the Asia-Pacific region. We also expanded our global exploration resource acreage, including new leases in the Gulf of Mexico where we already hold a significant position.”
Important recent upstream milestones include:
• Australia – Signed nonbinding Heads of Agreement with Tohoku Electric for LNG offtake, and additional binding agreements with Tokyo Electric for LNG offtake and an equity interest, for the Wheatstone Project. To date, more than 80 percent of Chevron’s equity LNG from Wheatstone is covered under long-term agreements with customers in Asia.
• Australia – Announced a natural gas discovery, Pontus-1, in the Carnarvon Basin in 47.3 percent-owned Block WA-37-L.
• United Kingdom – Initiated front-end engineering and design (FEED) for the deepwater Rosebank Project west of the Shetland Islands.
• Kurdistan Region of Iraq – Acquired an 80 percent interest and operatorship in the Rovi and Sarta blocks.
• Suriname – Acquired a 50 percent interest in two offshore exploration blocks.
• Ukraine – Bid successfully for a 50 percent interest and operatorship in a shale gas block.
• United States – Bid successfully for additional shelf and deepwater exploration acreage in the Gulf of Mexico.
Worldwide net oil-equivalent production was 2.62 million barrels per day in the second quarter 2012, down from 2.69 million barrels per day in the 2011 second quarter. Production increases from project ramp-ups in Thailand, the United States and Nigeria were more than offset by normal field declines, the shut-in of the Frade Field in Brazil, maintenance-related downtime and dispositions.
International upstream earnings of $4.30 billion decreased $619 million from the second quarter 2011. The decline between quarters was primarily due to lower realizations and volumes for crude oil, as well as higher exploration expense, partially offset by higher realizations for natural gas. Foreign currency effects increased earnings by $219 million in the 2012 quarter, compared with an increase of $26 million a year earlier.
The average sales price for crude oil and natural gas liquids in the 2012 second quarter was $99 per barrel, down from $107 a year earlier. The average price of natural gas was $6.10 per thousand cubic feet, compared with $5.49 in last year’s second quarter.
Net oil-equivalent production of 1.97 million barrels per day in the second quarter 2012 was down 35,000 barrels per day from a year ago. Production increases from project ramp-ups in Thailand and Nigeria were more than offset by normal field declines, the shut-in of the Frade Field in Brazil and maintenance-related downtime. The net liquids component of oil-equivalent production decreased 5 percent to 1.32 million barrels per day, while net natural gas production increased 6 percent to 3.89 billion cubic feet per day.
CAPITAL AND EXPLORATORY EXPENDITURES
Capital and exploratory expenditures in the first six months of 2012 were $14.2 billion, compared with $13.4 billion in the corresponding 2011 period. The amounts included approximately $827 million in 2012 and $584 million in 2011 for the company’s share of expenditures by affiliates, which did not require cash outlays by the company. Expenditures for upstream represented 91 percent of the companywide total in the first six months of 2012.