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ChevronTexaco quarterly earnings up, production down Price gains keep earnings, revenues rising as oil, gas flows both shrink Allen Baker Petroleum News Contributing Writer
ChevronTexaco, the second-largest U.S. oil company, posted earnings of $1.92 billion for the first quarter. That was a 165 percent gain over the $725 million the company posted in the same quarter a year ago. And it was more than double the profits of $904 million for the fourth quarter.
The hefty profit numbers did overshadow a substantial decline in production, however — about 5 percent in oil-equivalent numbers. The company blamed some of that on political problems in Nigeria and Venezuela, but noted that natural field declines were the main factor in reducing U.S. volumes by the equivalent of 66,000 barrels a day. Liquids flow down 8 percent Looking at liquids alone, the worldwide decline was a substantial 8 percent, or 152,000 barrels daily, as total oil and condensate flows dwindled to 1,823,000 barrels each day from 1,975,000 in the same quarter a year ago. The drop from the fourth quarter amounted to 19,000 barrels daily.
Still, collecting an extra $11 (internationally) or $12 (domestically) for each barrel of liquids, compared with the year-ago quarter, can cover a lot of decline in production. Liquids brought just over $29 in the quarter. U.S. gas yielded $5.85 per thousand cubic feet, a 150 percent increase, while international gas prices rose 20 percent to an average of $2.64.
On the gas side, a gain in international operations nearly made up for a 6 percent drop in the United States, but the worldwide production figure still slide 1 percent to 4,506 million cubic feet daily. That was up from 4,336 million cubic feet in the fourth quarter, however. Capital spending down The San Ramon, Calif., company isn’t accelerating its exploration spending to stem the decline, but instead cut $600 million off its investment in the future. Companywide, capital spending was down by 28 percent in the first quarter to $1.54 billion.
The company indicated that $600 million, the bulk of that, was due to additional investment in an affiliate, presumably troubled Dynegy, in 2002, along with buying assets that were previously leased in that quarter.
But nevertheless, U.S. E&P spending dropped to $347 million from $375 million. Internationally, the E&P decline was steeper, a 27 percent drop to $845 billion from $1.16 billion in the same quarter a year ago. Downstream and chemicals spending were about flat, with the “other” category in the United States was the other big loser, dropping more than a quarter of a billion dollars to $69 million. Figure Dynegy is in that category.
U.S. upstream income more than doubled to $666 million, and it would have been over $1 billion except for an accounting change that cut the number by a $350 million.
International operations showed a profit of $1.1 billion, after subtracting $145 million for the accounting change. That was a 32 percent rise compared with the same quarter a year ago.
Total E&P profits were $1.77 billion, up from $1.14 billion in 2002’s first quarter. It was also a nice bump from E&P’s fourth quarter earnings of $1.25 billion. Downstream rebounds Refining and marketing came back into the black in the quarter, with a profit of $315 million against a loss of $61 million in 2002’s first quarter and a loss of $166 million in the fourth quarter. That came despite a 6 percent decline in refinery inputs to 1,913,000 barrels daily from 2,035,000.
Chemicals earned $3 million, down from $15 million a year ago and from $13 million in the fourth quarter. The company owns half of Chevron Phillips Chemical Co.
Revenues reached $30.65 billion, a 47 percent gain from $20.84 billion a year ago. ChevronTexaco took in $27.06 billion in the fourth quarter.
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