White Plains, NY-based Texaco, the number three energy major, achieved record second quarter income that exceeded analysts’ expectations, reporting Wednesday that it had income of $817 million, or $1.50 per share, compared with $614 million, or $1.17 per share, for the second quarter of 2000. Net income for the period was $784 million, or $1.44 per share.

First Call/Thomson Financial had forecast earnings between 99 cents and $1.41 a share, with an average of $1.27.

CEO Glenn Tilton said the company’s earnings came “in an environment of favorable industry conditions,” including record performance in its U.S. downstream from refining operations, as well as outstanding results in the upstream sector from U.S. natural gas prices.

“Looking to the future, we continue to strengthen our upstream portfolio,” Tilton said. “Our high impact deepwater exploration program yielded two exciting discoveries in the Gulf of Mexico. The Blind Faith discovery on Mississippi Canyon Block 696 and the Champlain discovery in Atwater Valley Block 63 should add significantly to our future production and reserves.”

Tilton also reported “significant improvement” in the company’s global gas, power and energy technology segment. “Our U.S. natural gas trading business posted strong results as it continued to capitalize on significantly increased trading volumes through the delivery of structured, customer-based services.” He said that at the end of June, operations started up at the company’s newest facility, the 320 MW Sunrise Power Project in California.

Commenting on the merger with Chevron Corp. (see Daily GPI, Oct. 17, 2000), Tilton said that while Texaco remains focused on its strategies and operations, “we continue to make progress in our merger…and expect to complete the merger within the 12-month time frame.”

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