Page 4 - NorthAmOil Week 18 2022

NorthAmOil COMMENTARY NorthAmOil

ExxonMobil, Chevron post

first-quarter profits

US super-majors ExxonMobil and Chevron have both posted

multi-billion-dollar profits for the first quarter of 2022, but some

aspects of their performance fell short of expectations

GLOBAL US super-majors ExxonMobil and Chevron “The quarter illustrated the strength of our
have posted multi-billion-dollar profits for the underlying business and significant progress
WHAT: first quarter of 2022, during which West Texas in further developing our competitively advan-
Certain aspects of Intermediate (WTI) crude prices averaged $95 taged production portfolio,” stated Exxon-
ExxonMobil and Chevron’s per barrel and briefly rose above $120 per barrel. Mobil’s chairman and CEO, Darren Woods.
first-quarter performance The two companies’ results reflect broader “Earnings increased modestly, as strong margin
fell short of analyst trends playing out in the industry, which improvement and underlying growth was offset
expectations. remains overshadowed by the war in Ukraine. by weather and timing impacts. The absence
Oil and gas prices are up, allowing producers to of these temporary impacts in March provides
WHY: rake in high profits, but certain other headwinds strong, positive momentum for the second
Analysts pointed to lower- are materialising, including the fact that costs quarter.”
than-expected cash flow are also up. Meanwhile, numerous companies These were the first quarterly results for Exx-
levels and derivative- are in the process of exiting their operations in onMobil since it unveiled a net-zero emissions
related losses, among Russia amid Western sanctions on Moscow, target of 2050 in January. The company touted
other factors. with ExxonMobil among them. The exits were some of its decarbonisation initiatives from
announced with unprecedented speed follow- the first quarter, including a final investment
WHAT NEXT: ing Russia’s invasion of Ukraine in late Febru- decision (FID) on the expansion of its carbon
ExxonMobil recorded a ary, and represent billions of dollars’ worth of capture and storage (CCS) facility in Wyoming
$3.4bn charge related investments. and the unveiling of plans for a blue hydrogen
to its planned exit from plant in Texas. ExxonMobil also noted that
Sakhalin-1 but Chevron is ExxonMobil it had started selling MiQ-certified gas from
less exposed to Russia. ExxonMobil reported net income for the quarter its operations in the Permian Basin, with this
of $5.5bn, or $1.28 per share, down sequentially certification relating to its methane and emis-
from $8.9bn in the fourth quarter of 2021 but sions-reduction processes and technology
up from $2.7bn in the first quarter of last year. applications. These were the
Its sales and other operating revenue came in at Other upstream highlights for the super-ma-
$87.7bn, up from $57.6bn a year ago. jor included the start-up of Liza Phase 2, its sec- first quarterly
The super-major reported a $3.4bn write- ond major development offshore Guyana. After results for
down associated with its planned exit from the the first quarter, ExxonMobil also made an FID
Sakhalin-1 project in Russia in the wake of the on its Yellowtail development in the country. ExxonMobil since
war in Ukraine. It also pointed to “unfavourable
mark-to-market derivative effects” and “price Chevron it unveiled a net-
timing impacts”, which it said largely offset Chevron, meanwhile, posted net income of
higher industry prices and margins and reduced $6.3bn, or $3.22 per share, for the latest quarter, zero emissions
expenses. up from $5.1bn in the prior quarter and from target of 2050 in
Adjusting for the write-down, the compa- $1.4bn y/y. Its sales and other operating reve-
ny’s earnings for the quarter came in at $8.8bn, nue for the first quarter reached $52bn, up from January.
which it said represented an increase of more $31bn in the same quarter of 2021.
than $6bn year on year. The super-major reported global production
ExxonMobil’s production for the latest quar- of 3.06mn boepd in the first quarter. Like Exx-
ter came in at 3.7mn barrels of oil equivalent per onMobil, it saw a slight decline in its output,
day (boepd), down by 4% sequentially and by from 3.12mn boepd in the first quarter of 2021
3% y/y. The super-major attributed the decrease and 3.11mn boepd in the fourth quarter. During
to weather-related unscheduled downtime, the latest quarter, Chevron’s US production rose
planned maintenance, lower entitlements asso- 10% but its international output fell 8%, which it
ciated with higher prices and asset sales. attributed to normal field declines, the absence

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