ExxonMobil earns $7.8 billion in fourth quarter

ExxonMobil reported that its fourth quarter net income declined 33% from a year earlier to $7.82 billion.

Jan. 30, 2009

2 min read

By OGJ editors
HOUSTON, Jan 30 --ExxonMobil reported that its fourth quarter net income declined 33% from a year earlier to $7.82 billion.

The company said that higher downstream margins partly offset weaker crude oil prices, higher operating expenses, lower chemical volumes, and the lingering impacts of Gulf Coast hurricanes in the final 2008 quarter.

ExxonMobil's full-year 2008 earnings were a record $45.2 billion, up 11% from a year earlier. These record results included an after-tax special gain of $1.62 billion from the sale of a natural gas transportation business in Germany and after-tax special charges of $460 million related to litigation of the 1989 oil spill from the tanker Exxon Valdez in Alaska's Prince William Sound.

"ExxonMobil's financial strength continued to support its disciplined capital investment approach in the midst of a growing global economic slowdown. Capital and exploration project spending increased to $26.1 billion in 2008, up 25% from 2007," said ExxonMobil Chairman Rex W. Tillerson.

The company's total 2008 production was down 6% from 2007. Excluding the impacts of lower entitlement volumes, the expropriation of ExxonMobil's assets in Venezuela, and divestments, production decreased about 3%.

During the fourth quarter of 2008, oil and gas production volumes declined 3% from a year earlier. Excluding the impacts of lower entitlement volumes, OPEC quota effects, and divestments, production was down about 1%.

Fourth-quarter natural gas production was 9.849 bcfd, down 565 MMcfd from 2007, as new production volumes from project additions in the North Sea, Qatar, and Malaysia were more than offset by field declines and lower European demand.

Earnings from US upstream operations during the recent quarter were $699 million, down $576 million from the fourth quarter of 2007. Fourth-quarter non-US upstream earnings were $4.9 billion, down $2 billion from a year earlier.

Downstream earnings of $2.4 billion were up $147 million from the fourth quarter of 2007. Petroleum product sales of 6.76 million b/d were 364,000 b/d lower than the 2007 fourth quarter, mainly reflecting asset sales and lower demand.

Non-US downstream earnings were $789 million higher than during the fourth quarter of 2007, but ExxonMobil's US downstream segment recorded a quarterly loss of $20 million, down $642 million from the final 2007 quarter.

Chemical earnings for the recent quarter declined $957 million to $155 million. Lower volumes reduced earnings by $350 million, while lower margins decreased earnings by about $300 million. Hurricane repair costs and unfavorable foreign exchange effects also reduced earnings, ExxonMobil reported.