Chevron Corp surpassed expectations for first-quarter profit, driven by increased production volumes in the US which offset the impact of weak natural gas prices and fuel margins.
The oil giant reported a profit of $5.5 billion in the quarter ending March 31, slightly down from $6.57 billion a year ago. Despite this decline, results exceeded consensus estimates by 2%, driven by recent acquisitions that bolstered oil and gas volumes, according to Reuters.
“U.S. production was up 35% from a year ago, and we continued to meet major project milestones,” CEO Mike Wirth said in a statement.
The company reported a 12% increase in worldwide production compared to the previous year due to the acquisition of PDC and strong operational performance in the Permian and DJ Basins in the US and the Tengizchevroil affiliate in Kazakhstan, partly offset by planned downtime in Nigeria.
Meanwhile, earnings from oil and gas activities rose to $5.24 billion. However, profits from gasoline and chemicals production saw a decline, dropping to $783 million due to weaker margins and higher operating expenses in the refining sector.
The company returned $6.0 billion of cash to shareholders during the quarter, including dividends of $3.0 billion and share repurchases of nearly $3.0 billion.
The company’s return on capital employed in the first quarter of 2024 exceeded 12%, with an 8% increase in dividend per share payout from the previous quarter.
Chevron reported adjusted per share profit of $2.93 for the first quarter, beating analysts’ consensus estimate of $2.87.
During the quarter, Chevron has commenced the Wellhead Pressure Management Project at Tengizchevroil, in addition to reaching final investment decision to add midstream infrastructure expected to increase production capacity at the Tamar gas field in Israel to 1.6 billion cubic feet per day.
The company also expanded its the fuel marketing network in key US West Coast and Gulf Coast markets, encompassing more than 250 retail stations.
The company also announced various projects focused on renewable energy and carbon capture, including the launch of a $500 million Future Energy Fund III to invest in technology-based solutions for affordable, reliable, and lower carbon energy.
Additionally, the company has drilled onshore and offshore stratigraphic wells to delineate carbon dioxide storage potential through the company’s joint venture Bayou Bend CCS LLC.
The company also reached a final investment decision to build an oilseed processing plant in Louisiana and announced its first solar-to-hydrogen production project in California.
