Led by massive projects in the deepwater of the Gulf of Mexico (GOM) and Australian liquefied natural gas (LNG), Chevron Corp. is maintaining a production target of 3.3 million boe/d by the end of 2017, executives said Friday.

The gains will come even though 2Q2012 worldwide output fell 2.6% year/year to 2.62 million boe/d, Chevron Vice Chairman George Kirkland said during a quarterly earnings conference call.

The company has exploration and production (E&P) opportunities around the world that will guide output for years to come, he said. In the U.S. onshore arena alone, “there are upstream opportunities in the Permian Basin, Marcellus Shale, Duvernay in Alberta, Poland, Argentina and China.”

Chevron’s exploration unit is back-loaded with projects now being developed, in particular two GOM deepwater fields, Jack/St. Malo and Bigfoot, which are part of a big GOM portfolio that is expected to lead the company’s output in the years to come, said CFO Pat Yarrington. In addition to the GOM deepwater, Australia LNG export facilities, Gorgon and Wheatstone, remain on schedule.

“These four projects form the cornerstone of our production growth,” said Yarrington.

The portfolio, however, is continually being manipulated, said Kirkland. “Our average portfolio has taken a significant shift to the right of what’s out there,” he explained. “We’re always upgrading our portfolio on a continued basis and looking at the tail-end of the portfolio…those pieces that aren’t performing that well.”

An example, he said, was the sale of 20,000 b/d in the Cook Inlet of Alaska, which was “taken off the books in December.”

Chevron is careful to “make sure we don’t sell anything that has future opportunities related to the different stratigraphic on that acreage,” he said. “Very importantly, we want to make sure that acreage doesn’t have a technology opportunity to unlock more barrels. If we sell out of one place, we might lose an opportunity, and it’s tough coming back and buying that acreage if we exit too soon.”

The company earned $7.2 billion ($3.66/share) in 2Q2012, down slightly from year-ago earnings of $7.7 billion ($3.85), but still well ahead of Wall Street expectations of $3.24. Sales and other operating revenues, however, slid 9.2% to $62.6 billion from $68.5 billion.

Exploration and production earnings were down 18% to $5.62 billion, primarily because of lower natural gas and crude oil prices, lower output production and the absence of gains on asset sales. U.S. upstream earnings hit $1.32 billion, down $632 million from 2Q2011. The average sales price for crude oil and natural gas liquids was $97/bbl in 2Q2012 from $104 a year ago. The average sales price of natural gas was $2.17/Mcf, compared with $4.35 in 2Q2011.

Chevron’s net liquids production fell 4% year/year to 461,000 boe/d, while net natural gas production decreased 9% to 1.19 Bcf/d.

Total output totaled 659,000 boe/d in the latest quarter, which was 5% lower (35,000 boe/d) than in the year-ago period. The decline in part came from normal field declines, as well as the loss of volumes associated with the sale of the Cook Inlet assets. Partially offsetting the drop in output was the ramp-up in 2Q2012 at the Perdido and Caesar/Tonga projects in the deepwater GOM.

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