Chevron reports $588mn Q4 2015 loss

Feb 02, 2016 12:00 AM

American oil and gas major Chevron Corporation has reported a loss of $588mn for Q4 2015, compared with earnings of $3.5bn ($1.85 per share, diluted) in Q4 2014.

Foreign currency effects increased earnings in the Q4 2015 quarter by $46mn, compared with an increase of $432mn a year earlier. Full year 2015 earnings were $4.6bn ($2.45 per share, diluted) compared with $19.2bn ($10.14 per share, diluted) in 2014.

Sales and other operating revenues in Q4 2015 were $28bn, compared to $42bn in the year ago period.

“Our 2015 earnings were down significantly from the previous year, reflecting a nearly 50% year-on-year decline in crude oil prices,” said chairman and CEO John Watson.

“We’re taking significant action to improve earnings and cash flow in this low price environment,” Watson stated.

“Operating expenses and capital spending were reduced to $9bn in 2015 from 2014, and I expect similarly large reductions again in 2016. In addition, asset sales proceeds were $6bn in 2015, with additional sales planned for 2016 and 2017,” Watson revealed.

Watson commented that the Chevron approximately added 1.02bn barrels of net oil equivalent proved reserves in 2015.

These additions, which are subject to final reviews, equate to approximately 107% of net oil equivalent production for the year.

The largest additions were from production entitlement effects in several locations and drilling results for the Permian Basin in the US and the Wheatstone Project in Australia.

At year end, balances of cash, cash equivalents, time deposits and marketable securities totalled $11.3bn, a decrease of $1.9bn from the end of 2014.

Total debt at December 31, 2015 stood at $38.6bn, an increase of $10.8bn from a year earlier.

Chevron’s worldwide net oil equivalent production was 2.67mn bpd in Q4 2015, up from 2.58mn bpd in Q4 2014. Net oil equivalent production for the full year 2015 was 2.62mn bpd, an increase of 2% from the prior year, and within the range of the production guidance for the year.

Production increases from project ramp ups in the US and Bangladesh, and production entitlement effects in several locations, were partially offset by the Partitioned Zone in the Saudi Arabia-Kuwait neutral zone shut-in and normal field declines for both comparative periods.

International upstream operations earned $593mn in Q4 2015 compared with $2.24bn a year earlier.

The decrease was due to lower crude oil and natural gas realisations and lower gains on asset sales. Partially offsetting these effects were lower depreciation, operating, tax and exploration expenses, and higher crude oil production.

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