The world’s largest public oil company raked in second-quarter profits commensurate with its size. Exxon Mobil Corp., broke its own quarterly earnings record (see Daily GPI, April 28) in 2Q 2006, reporting net income of $10.36 billion, $1.72/share, an increase of $2.72 billion from the second quarter of 2005. First half net income of $18.76 billion, $3.09/share, increased by 21% versus first-half 2005.

Net income from U.S. upstream operations rose to $1.644 billion in 2Q 2006 from $1.39 billion in the year-ago period and to $2.92 billion in the first half of 2006 from $2.74 billion in the year-ago period.

Natural gas production available for sale declined in both the United States and Canada but was up overall worldwide. U.S. gas production declined to 1,673 MMcf/d in the second quarter from 1,835 in the year-ago period. In the first half of the year, gas production declined to 1,683 MMcf/d from 1,866 MMcf/d in the year-ago period. Canadian production declined to 841 MMcf/d in the second quarter from 913 MMcf/d in the year-ago period. In the first half of the year, Canadian gas production declined to 861 MMcf/d from 918 MMcf/d in the year-ago period. Gas production also declined in Europe but grew in the Asia Pacific/Middle East and Russia/Caspian regions. The company did not provide data on realized commodity prices.

“ExxonMobil’s second quarter earnings excluding special items, were a record $10,360 million, up 32% from second quarter 2005. Earnings per share excluding special items were up 40% reflecting the impact of the continuing share purchase program,” said Chairman Rex Tillerson. “Higher crude oil and natural gas realizations and improved refining margins were partly offset by lower marketing margins.”

ExxonMobil continued its active investment program in the second quarter, spending $4.9 billion on capital and exploration projects, an increase of 8% versus 2005. As a result of additional upstream opportunities, we now expect full year capital spending to total $20 billion. In the second quarter of 2006, the results of the company’s continuing long-term investment program yielded an additional 243 thousand oil-equivalent barrels per day of production, a 6% increase over the second quarter of 2005.”

Upstream earnings in 2Q 2006 were $7,134 million, up $2,226 million from the second quarter of 2005, primarily reflecting higher crude oil and natural gas realizations. On an oil-equivalent basis, production increased by 6% from the second quarter of 2005. Excluding the impact of divestments and entitlements, production increased 9%. Liquids production of 2,701 kb/d (thousands of barrels per day) was 233 kb/d higher.

Second quarter natural gas production was 8,769 MMcf/d compared with 8,709 MMcf/d last year. Higher volumes from projects in Qatar were partly offset by the impact of mature field decline and planned maintenance activity.

Non U.S. upstream earnings were $5.49 billion, up $1.97 billion from 2005. Downstream earnings excluding special items, were $2.49 billion, up $264 million from the second quarter 2005. The improved results reflect stronger worldwide refining margins, which were partly offset by weaker marketing margins and lower refining throughput. Petroleum product sales were 7.06 million bbl/d, 450,000 bbl/d lower than last year’s second quarter, primarily due to lower refining throughput associated with planned maintenance and divestments. U.S. downstream earnings were $1.35 billion, up $155 million. Non-U.S. downstream earnings of $1.13 billion were $109 million higher than in the second quarter of 2005.

©Copyright 2006Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.