Chevron Corporation has reported net income of $4.90 billion ($2.44 per share -- diluted) for the fourth quarter 2008, up from $4.88 billion ($2.32 per share -- diluted) in the year-ago period. Results for the 2008 fourth quarter included a gain of approximately $600 million on an upstream asset-exchange transaction. Foreign-currency effects benefited net income by $478 million in the period, compared with a reduction to earnings of $2 million in the 2007 fourth quarter. Full-year 2008 net income was $23.93 billion ($11.67 per share -- diluted), up 28 percent from $18.69 billion ($8.77 per share -- diluted) in 2007. Sales and other operating revenues in the fourth quarter 2008 were $43 billion, compared with $60 billion a year earlier. For the year 2008, sales and other operating revenues were $265 billion, versus $214 billion in 2007.
"Fourth-quarter earnings for our downstream business improved as the lower cost of crude-oil feedstocks used in the refining process helped boost margins on the sale of gasoline and other refined products," said Chairman and CEO Dave O’Reilly. "Lower quarterly profits for our upstream operations reflected a sharp decline in crude-oil prices from a year ago.
"We achieved much success in 2008," O'Reilly added. "Record earnings and strong cash flows for the year enabled us to invest $23 billion in an attractive portfolio of capital and exploratory projects, buy back $8 billion of our common stock and increase the dividend payment on our common shares for the 21st consecutive year. We enter 2009 with the financial strength to meet the challenges of a difficult economy and with a continued focus on cost management and capital stewardship."
O'Reilly also noted other activities of operational and strategic importance in recent months:
UPSTREAM -- EXPLORATION AND PRODUCTION
Worldwide oil-equivalent production averaged 2.54 million barrels per day in the fourth quarter 2008, compared with 2.61 million barrels per day in the corresponding 2007 period. The decline between periods was primarily associated with the ongoing effect of damage to production facilities caused by hurricanes in the Gulf of Mexico in September 2008.
U.S. upstream income of $1.15 billion in the fourth quarter 2008 decreased $229 million from a year earlier. The 2008 period included an approximate $600 million gain on a transaction involving the receipt of Chevron stock in exchange for a producing property, plus cash. Prices for crude oil and natural gas were lower in the 2008 fourth quarter. Oil-equivalent production was also lower, and operating expenses were higher.
The average sales price per barrel of crude oil and natural gas liquids was $49 in the fourth quarter 2008, down from $79 in the corresponding 2007 period. The average sales price per thousand cubic feet of natural gas decreased from $6.08 to $5.23.
Net oil-equivalent production was 619,000 barrels per day in the 2008 fourth quarter, down 111,000 from a year earlier. About 75 percent of the decline was associated with the continuing effects of production that was shut-in as a result of September hurricanes in the Gulf of Mexico. The net liquids component of production was down 12 percent at 399,000 barrels per day, and net natural gas production declined 21 percent to 1.3 billion cubic feet per day.
At the end of 2008, approximately 50,000 barrels per day of oil-equivalent production remained offline in the Gulf of Mexico due to the hurricanes, with restoration of the volumes to occur as repairs to third-party pipelines and producing facilities are completed.
International upstream earnings of $2 billion in the fourth quarter 2008 decreased $1.46 billion from a year earlier due to lower prices for crude oil, a reduction in sales volumes associated with the timing of certain cargo liftings and higher depreciation expense. Foreign-currency effects benefited earnings by $644 million in the 2008 quarter, compared with an $88 million reduction to income in the 2007 corresponding period.
The average sales price per barrel of crude oil and natural gas liquids was $47 in the 2008 quarter, down from $80 a year earlier. The average sales price per thousand cubic feet of natural gas increased from $4.32 to $5.10.
Net oil-equivalent production was 1.92 million barrels per day in the 2008 fourth quarter, up 38,000 barrels per day from a year earlier. The 2008 period included an increase of approximately 150,000 barrels per day from the project start-up earlier in the year at Agbami in Nigeria and the ramp-up of production associated with the expansion project at Tengiz in Kazakhstan. Production was lower in Azerbaijan, Thailand and Venezuela. The net liquids component of production increased 2 percent from a year ago to 1.34 million barrels per day, while natural gas production increased 2 percent to 3.49 billion cubic feet per day.
CAPITAL AND EXPLORATORY EXPENDITURES
Capital and exploratory expenditures for the year 2008 were $22.8 billion, compared with $20.0 billion in 2007. The amounts included approximately $2.3 billion in each year for the company’s share of expenditures by affiliates, which did not require cash outlays by Chevron’s consolidated companies. Expenditures for upstream projects represented about 75 percent of the companywide total in 2008.
Most Popular Articles
From the Career Center
Jobs that may interest you