California-based oil company Chevron today announced earnings of $5.7 billion ($2.98 per share – diluted) for second quarter 2014, compared with $5.4 billion ($2.77 per share – diluted) in the 2013 second quarter.
Foreign currency effects decreased earnings in the 2014 quarter by $232 million, compared with an increase of $302 million a year earlier. Sales and other operating revenues in second quarter 2014 were $56 billion, compared to $55 billion in the year-ago period.
“Our second quarter earnings and cash flow were solid,” said Chairman and CEO John Watson. “Current quarter earnings reflected stronger market conditions for crude oil, although some of these benefits were offset by lower production volumes as a result of planned maintenance activity at Tengizchevroil in Kazakhstan. Gains on asset sales also contributed to our results, as we completed important sales under our three-year divestment program.”
Watson added: “We continue to make significant progress on our major capital projects which are expected to underpin a 20 percent increase in production by 2017 and enable significant growth in our cash flows. In the deepwater Gulf of Mexico, our production is expected to benefit in the near-term from start-up of the Jack/St. Malo Project later this year and the Big Foot Project in 2015. In Australia, our Gorgon and Wheatstone LNG projects continue to reach important interim milestones. Gorgon remains on track for expected start-up in mid-2015. We are also advancing the development of our liquids-rich, unconventional properties in the United States, Canada and Argentina.”
The company’s net oil-equivalent production was 2.55 million barrels per day in second quarter 2014, down from 2.58 million barrels per day in the 2013 second quarter. Chevron explained that production increases from project ramp-ups in the United States, Nigeria, Brazil and Argentina were more than offset by price and other production entitlement effects in several locations, normal field declines, and maintenance-related downtime at Tengizchevroil in Kazakhstan.
Chevron’s capital and exploratory expenditures in the first six months of 2014 were $19.6 billion, compared with $18.3 billion in the corresponding 2013 period. The amounts included $1.5 billion in 2014 and $1.1 billion in 2013 for the company’s share of expenditures by affiliates, which did not require cash outlays by the company. Work progressed during 2014 on a number of major capital projects, including the Gorgon and Wheatstone LNG projects in Australia and the Jack/St. Malo and Big Foot projects in the deepwater Gulf of Mexico. Expenditures for upstream represented 93 percent of the companywide total in the first six months of 2014.