While US oil production increased 10,000 b/d to 274,000 b/d, overall US production declined 4,000 boe/d, which the company attributes to reduced gas drilling.
Production from the Middle East-North Africa region also declined, down 14,000 boe/d, as the company’s operations were impacted by field and port strikes in Libya, insurgent activity in Yemen, and full cost recovery and other adjustments under Oxy’s production-sharing agreements, partially offset by an increase of 9,000 boe/d in Qatar.
The company’s net income for the first quarter was $1.4 billion, which was equal with last year’s first-quarter earnings. Oil and gas segment earnings were $2.1 billion for the first quarter, up from $1.9 billion in first-quarter 2013.
Oxy said the first-quarter results, which mainly reflect higher US earnings, resulted from higher US oil, NGL, and gas prices and higher worldwide oil volumes, partially offset by lower international oil prices, higher US operating costs, and higher depreciation, depletion, and amortization rates.
The increase in operating costs was due to higher costs for carbon dioxide, steam, and power, which are affected by crude oil and natural gas prices, along with increased downhole maintenance activity levels, the company said.
“We are on track with our key long-term projects,” said Stephen I. Chazen, Oxy president and chief executive officer. “The New Johnsonville chlor-alkali plant started production in March, the BridgeTex Pipeline is expected to start operations in the third quarter, and the Al Hosn Gas Project is expected to start-up by the end of the year (OGJ Online, June 12, 2012).”