Chevron reported in its interim update that earnings for the fourth quarter 2009 are expected to be lower than in the third quarter 2009. Upstream earnings are projected to be in line with third quarter results as the benefit of higher commodity prices is offset by the absence of gains recognized in the third quarter associated with formal approval of the Gorgon project in Australia. Downstream results are expected to be sharply lower, mainly due to significantly weaker refining margins.
Compared with the average for the third quarter 2009, U.S. net oil-equivalent production during the first two months of the fourth quarter rose 14,000 barrels per day primarily in the Gulf of Mexico.
International net oil-equivalent production increased 57,000 barrels per day compared with the third quarter. The liquids component of oil-equivalent production increased 42,000 barrels per day reflecting normal operations in Nigeria and the continued ramp-up of production from the expansion project at the Tengiz Field in Kazakhstan. Net natural gas production increased 106 million cubic feet per day, mainly due to the completion of planned maintenance at North Sea fields and higher sales in Thailand.
For the first two months of the fourth quarter, U.S. crude oil realizations rose $6.64 per barrel to $69.92. International liquids realizations also improved by more than $6 to $68.14 per barrel. U.S. natural gas realizations increased $0.66 to $3.94 per thousand cubic feet compared with the third quarter, while average international natural gas realizations improved slightly to $3.99 per thousand cubic feet.
International upstream earnings in the third quarter included gains and related tax effects of about $400 million connected with formal project approval of the Gorgon project.
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