Chevron Corp. sold more than $500 million of its global assets between April and May, which should lift second quarter profits but do little to increase global production, the oil major said Thursday.
In an interim 2Q2014 update for April and May only, the San Ramon, CA-based major said oil and gas output averaged 2.566 million boe/d. If that average were to hold through June, output will have fallen 0.6% from the full second period of 2013. Quarterly results are scheduled to be issued on Aug. 1.
However, U.S. production was higher in April and May than in the year-ago period primarily because of less maintenance activity in the Gulf of Mexico, and on increased output from the Permian Basin. Chevron in the two-month period produced 665,000 boe/d net in the United States, which included 1,229 MMcf/d of natural gas and 460,000 b/d of liquids. In the same two-month period of 2013, domestic production was 659,000 boe/d net, including gas output of 1,227 MMcf/d and liquids production of 455,000 b/d.
Sequentially, U.S. output in 1Q2014 was 640,000 boe/d net, down 4% from 1Q2013 (see Daily GPI, May 5). The net liquids component decreased 4% to 438,000 boe/d, while gas production fell 3% to 1.21 Bcf/d.
U.S. average realizations were higher for natural gas in April and May from a year ago at $4.11/Mcf versus $3.78. Liquids prices in the United States have averaged $92.01/bbl from $92.25 in April and May 2013.
U.S. downstream earnings for the full second quarter are expected to be comparable to 1Q2014, Chevron said. "Higher U.S. refining margins, particularly on the West Coast, were offset by lower volumes and higher operating expenses due to significant planned turnaround activity at the El Segundo refinery" in California.
Chevron over the past three years has sold close to $7 billion in assets and has $10 billion more in the queue to sell over the next three (see Daily GPI, March 11). This year's capital spending is set at $39.8 billion, $2 billion less than in 2013, with 34% aimed at North America and about as much in the Asia-Pacific.