Chevron Corp. reported net earnings of $6.4 billion for fourth-quarter 2022, up from $5.1 billion in fourth-quarter 2021 (OGJ Online, Jan. 28, 2022). Included in the current quarter were $1.1 billion of international upstream write-off and impairment charges, and pension settlement costs of $17 million. Foreign currency effects decreased earnings by $405 million. Adjusted earnings of $7.9 billion in fourth-quarter 2022 compared with adjusted earnings of $4.9 billion in fourth-quarter 2021.
Chevron also reported full-year 2022 earnings of $35.5 billion, compared with $15.6 billion in 2021. Adjusted earnings of $36.5 billion in 2022 compared with adjusted earnings of $15.6 billion in 2021.
Upstream
Chevron’s worldwide net oil-equivalent production was 3.01 million b/d in fourth-quarter 2022 and 3 million b/d for full-year 2022. Both quarterly and annual production were down 3% compared to their respective 2021 periods. International production decreased 7% in 2022 primarily due to the end of concessions in Thailand and Indonesia, while US production increased 4% compared with 2021, mainly in the Permian basin.
The company’s US upstream operations earned $2.62 billion in fourth-quarter 2022, compared with $2.97 billion a year earlier. The decrease was primarily due to the absence of fourth-quarter 2021 asset sale gains, partially offset by higher realizations.
US net oil-equivalent production of 1.19 million b/d in fourth-quarter 2022 was down slightly from a year earlier as decreases in the Gulf of Mexico were partially offset by increases in the Permian basin. The net liquids component of oil-equivalent production in fourth-quarter 2022 decreased 4% to 895,000 b/d, and net natural gas production increased 4% to 1.79 bcfd compared with last year’s fourth-quarter.
International upstream operations earned $2.87 billion in fourth-quarter 2022, compared with $2.19 billion a year ago. The increase in earnings was primarily due to higher realizations, partially offset by write-off and impairment charges, and an unfavorable foreign exchange impact of $74 million compared to last year’s fourth-quarter.
Chevron’s international net oil-equivalent production of 1.82 million b/d in fourth-quarter 2022 was down 82,000 b/d from fourth-quarter 2021. The decrease was primarily due to the absence of production following expiration of the Erawan concession in Thailand. The net liquids component of oil-equivalent production decreased 5% to 852,000 b/d in fourth-quarter 2022, while net natural gas production decreased 4% to 5.8 bcfd compared with last year’s fourth-quarter.
Downstream
Chevron’s US downstream operations reported earnings of $1.18 billion in fourth-quarter 2022, compared with earnings of $660 million a year earlier. The increase was mainly due to higher margins on refined product sales, partially offset by lower earnings from the 50%-owned Chevron Phillips Chemical Co.
The company’s refinery crude oil input in fourth-quarter 2022 increased slightly to 888,000 b/d from the year-ago period. Refined product sales of 1.24 million b/d were up 7% from the year-ago period, mainly due to higher renewable fuel sales following the Renewable Energy Group Inc. acquisition and higher jet fuel demand.
International downstream operations reported earnings of $591 million in fourth-quarter 2022, compared with $100 million a year earlier. The increase was mainly due to higher margins on refined product sales, partially offset by an unfavorable swing in foreign currency effects of $114 million compared with last year’s fourth-quarter.
Chevron’s international refinery crude oil input of 653,000 b/d in fourth-quarter 2022 increased 8% from the year-ago period as refinery runs increased due to higher demand. Refined product sales of 1.44 million b/d in fourth-quarter 2022 increased 9% from the year-ago period, mainly due to higher jet fuel demand as restrictions from the pandemic continue to ease.
Capital, exploratory expenditures
Capital and exploratory expenditures for Chevron’s consolidated entities (C&E) in 2022 were $12.3 billion, compared with $8.6 billion in 2021. Additionally, the company’s share of equity affiliate capital and exploratory expenditures (Affiliate C&E) was $3.4 billion in 2022 and $3.2 billion in 2021 and did not require cash outlays by the company. C&E for 2022 includes $1.3 billion of inorganic spend largely associated with the formation of the Bunge joint venture and acquisition of the remaining interest in Beyond6. The acquisition of Renewable Energy Group is not included in the company’s C&E.
