In what Chairman-CEO Mike Wirth calls “a challenging and dynamic macroeconomic and geopolitical environment,” the Chevron Corp. reports a highly successful third quarter of 2022 with earnings of $11.2 billion compared to $6.1 billion in the third quarter last year.
“Our strategy remains clear and consistent and our results keep getting better,” Wirth said. “While future market conditions are uncertain, we’re well-positioned to deliver value to our shareholders in any environment.
“Year to date, Permian Basin production is little over 700,000 barrels a day, up 15 percent from the first three quarters of last year, which was just a touch over 600,000. So we’re seeing good growth.
“For the third quarter itself, production was up 10 percent at 708,000 barrels a day versus 646,000 in the same quarter last year.”
Wirth said Chevron’s inventory of drilled but uncompleted wells grew a lot during the pandemic. “We didn’t need to frac wells and bring them online when there was declining demand for production,” he said.
“We kept some drilling going, so that inventory grew. As we went back to work, the first thing we did was send completion crews out and start to bring the DUCs online.
“Earlier this week, we released our methane report with specific disclosures about our aim to be a leader in methane emissions management,” Wirth said last Friday. “Our goal is simple: keep the methane in the pipe.”
Reporting from company headquarters in San Ramon, Calif., Chevron Chief Financial Officer Pierre Breber said third quarter business included $177 million of pension settlement costs.
“We repurchased shares at the high end of our guidance range and ended the quarter with a net debt ratio under five percent,” Breber said. “For the sixth consecutive quarter, Chevron’s free cash flow exceeded $5 billion and we’re on track to beat 2021’s free cash flow record.”
Breber said growth in the Permian Basin was offset by the expiration of contracts in Thailand and Indonesia and the sale of the company’s Eagle Ford assets in the shale formation that runs from the U.S.-Mexico border between Laredo and Eagle Pass through counties east of Waco and Temple.
“Now looking ahead in the fourth quarter, we expect a modest turnaround,” he said. “After producing a record number of liquefied natural gas cargoes in third quarter, we expect fewer spot cargoes out of Australia due to maintenance and summer temperatures.”
In the third quarter, Breber said, the company got a dividend from Angola LNG and it expects fourth quarter dividends from that company and from TCO, its oil operator in Kazakhstan.
