In yet another record year that was spurred by its upstream operations, ExxonMobil Corp. boosted its fourth quarter income 63% over a year ago, reporting $6.65 billion ($1.01/share), an increase of $2.56 billion year-over-year. Excluding still-lingering merger effects, discontinued operations and special items, ExxonMobil’s earnings were up $630 million from 4Q2002.
All of the corporation’s business lines contributed to the strong earnings growth, according to investor relations chief Pat Mulva. In a conference call with analysts, Mulva said ExxonMobil’s strong earnings were leveraged by innovative technology, “coupled with superior execution” that distinguished the world’s largest oil and gas company over its peers. As he detailed the accomplishments of each business segment, Mulva noted that liquefied natural gas (LNG) was becoming a more important element of the company’s success.
“The continued growth in LNG is evident,” said Mulva. He detailed a November 2003 agreement with Qatar Petroleum, which, among other markets, will bring ample LNG supplies to North America. “We also have begun the first permitting process for two LNG facilities in Texas, which are expected to be operational by a 2008-2009 time frame. They will each have at least 1 Bcf/d of capacity.”
Mulva said ExxonMobil expects to grow its LNG business worldwide with a patented LNG technology from a UK-based company that would provide a “high degree of safety and significant cost savings for import and export terminals.”
Last year, Mulva pointed to the company’s “unparalleled portfolio of upstream projects,” especially in developing areas of West Africa. Fourth quarter upstream earnings were $3.269 billion, an increase of $267 million from 2002 results. Liquids volumes increased 4% in the quarter from new projects in West Africa and Norway. However, on an oil-equivalent basis, production was down 1%, with contributions from new projects “more than offset” by natural field decline of both oil and gas, especially in North America.
ExxonMobil also continued to actively invest last year. In the fourth quarter it spent $4.36 billion on capital and exploration projects, compared with $4.025 billion a year earlier, reflecting continued growth in upstream spending.
Fourth quarter natural gas production was 10.858 Bcf/d, down from 11.667 Bcf/d last year. However, worldwide oil and gas production was up 3.9% to 2.56 MMboe/d.
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