Chevron Issues Interim Update for Fourth Quarter 2012

Thu Jan 10, 2013 5:00pm EST

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SAN RAMON, Calif.--(Business Wire)--
Chevron Corporation (NYSE: CVX) today reported in its interim update that
earnings for the fourth quarter 2012 are expected to be notably higher than
third quarter 2012. Upstream results are projected to be higher between
sequential quarters, reflecting increased gains on asset transactions and higher
liftings. Downstream earnings in the fourth quarter are also expected to be
higher, largely reflecting a positive swing in timing effects, despite a sharp
decline in industry refining margins. 

Basis for Comparison in Interim Update

This interim update contains certain industry and company operating data for the
fourth quarter 2012. The production volumes, realizations, margins and certain
other items in the report are based on a portion of the quarter and are not
necessarily indicative of Chevron's full quarterly results to be reported on
February 1, 2013. The reader should not place undue reliance on this data. 

Readers are advised that portions of the commentary below compare results for
the first two months of the fourth quarter 2012 to full third quarter 2012
results, as indicated. 

UPSTREAM

The table that follows includes information on production and price indicators
for crude oil and natural gas for specific markets. Actual realizations may vary
from indicative pricing due to quality and location differentials and the effect
of pricing lags. International earnings reflect actual liftings, which may
differ from production due to the timing of cargoes and other factors.

                                                     2011      2012                                                  
                                                     4Q        1Q         2Q         3Q         4Q thru     4Q thru  
                                                                                                Nov         Dec      
 U.S. Upstream                                                                                                       
 Net Production:                                                                                                     
 Liquids                                    MBD      447       456        461        440        467         n/a      
 Natural Gas                                MMCFD    1,290     1,170      1,186      1,184      1,261       n/a      
 Total Oil-Equivalent                       MBOED    661       651        659        637        676         n/a      
                                                                                                                     
 Pricing:                                                                                                            
 Avg. WTI Spot Price                        $/Bbl    93.98     103.00     93.34      92.25      88.21       88.22    
 Avg. Midway Sunset Posted Price1           $/Bbl    107.83    112.01     102.72     100.71     98.32       98.59    
 Nat. Gas-Henry Hub "Bid Week" Avg.         $/MCF    3.55      2.73       2.21       2.81       3.25        3.40     
 Nat. Gas-CA Border "Bid Week" Avg.         $/MCF    3.74      2.96       2.40       2.46       2.96        3.37     
 Nat. Gas-Rocky Mountain "Bid Week" Avg.    $/MCF    3.35      2.56       1.88       2.91       3.15        3.56     
                                                                                                                     
 Average Realizations:                                                                                               
 Crude                                      $/Bbl    105.37    108.37     103.91     97.34      97.61       n/a      
 Liquids                                    $/Bbl    100.65    101.93     97.46      90.77      91.11       n/a      
 Natural Gas                                $/MCF    3.62      2.48       2.17       2.63       3.14        n/a      
                                                                                                                     
 International Upstream                                                                                              
 Net Production:                                                                                                     
 Liquids                                    MBD      1,369     1,338      1,317      1,249      1,335       n/a      
 Natural Gas                                MMCFD    3,658     3,849      3,894      3,778      3,900       n/a      
 Total Oil Equivalent                       MBOED    1,980     1,980      1,965      1,879      1,986       n/a      
                                                                                                                     
 Pricing:                                                                                                            
 Avg. Brent Spot Price 2                    $/Bbl    109.35    118.60     108.29     109.50     110.38      110.08   
                                                                                                                     
 Average Realizations:                                                                                               
 Liquids                                    $/Bbl    101.33    110.03     99.21      98.20      100.06      n/a      
 Natural Gas                                $/MCF    5.55      5.88       6.10       6.03       5.94        n/a      
 1 As of second quarter 2012, Avg. Midway Sunset Posted Price is based on the average of four companies` posted prices to better reflect realizations. Prior to second quarter 2012, the price is based only on the Chevron average posting. 
 2 The Avg. Brent Spot Price is based on Platts daily assessments, using Chevron`s internal formula to produce a quarterly average. 
                                                                                                                     


U.S. net oil-equivalent production increased 39,000 barrels per day during the
first two months of the fourth quarter, reflecting recovery from the impacts of
Hurricane Isaac and an increase in production associated with recently acquired
acreage in the Permian Basin. International net oil-equivalent production during
the first two months of the fourth quarter increased 107,000 barrels per day,
mainly due to the absence of planned maintenance in Kazakhstan and the United
Kingdom. 

International upstream earnings in the fourth quarter are expected to include a
gain of approximately $1.4 billion from a previously announced asset exchange in
Australia, compared to a gain of $600 million in the third quarter associated
with the sale of an equity interest in the Wheatstone project. 

U.S. crude oil realizations increased $0.27, to $97.61 per barrel during the
first two months of the fourth quarter, consistent with the typical monthly lag
on pricing in the Gulf of Mexico. International liquids realizations increased
$1.86, to $100.06 per barrel. U.S. natural gas realizations increased $0.51 to
$3.14 per thousand cubic feet, while international natural gas realizations
decreased $0.09 to $5.94 per thousand cubic feet during the first two months of
the fourth quarter. 

DOWNSTREAM

The table that follows includes industry benchmark indicators for refining and
marketing margins. Actual margins realized by the company will differ due to
crude and product mix effects, planned and unplanned shutdown activity and other
company-specific and operational factors.

                                                    2011     2012                                               
                                                    4Q       1Q        2Q        3Q        4Q thru     4Q thru  
                                                                                           Nov         Dec      
 Downstream                                                                                                     
 Market Indicators:                        $/Bbl                                                                
 Refining Margins                                                                                               
 U.S. West Coast - Blended 5-3-1-1                  14.45    19.64     21.32     24.37     23.45       19.45    
 U.S. Gulf Coast - Maya 5-3-1-1                     11.84    20.56     24.89     28.19     24.15       23.24    
 Singapore - Dubai 3-1-1-1                          8.77     9.73      9.30      10.77     7.59        7.17     
 Marketing Margins                                                                                              
 U.S. West - Weighted DTW to Spot                   5.39     4.16      10.14     5.74      9.76        8.85     
 U.S. East - Houston Mogas Rack to Spot             4.35     3.90      5.10      3.99      4.98        5.21     
 Asia-Pacific / Middle East / Africa                5.65     4.75      6.98      6.08      6.63        4.39     
 Actual Volumes:                                                                                                
 U.S. Refinery Input                       MBD      763      926       928       779       702         n/a      
 Int`l Refinery Input1                     MBD      805      779       870       909       918         n/a      
 U.S. Branded Mogas Sales                  MBD      515      505       521       519       511         n/a      
                                                                                                                
 1 As of June 2012, Star Petroleum Refining Company crude-input volumes are reported on a consolidated basis. Prior to June 2012, crude-input volumes are reported on a net interest basis. 
                                                                                                                


For the full fourth quarter, U.S. and international refining margins decreased
significantly compared to third quarter 2012. International marketing margins
also declined, while U.S. marketing margins improved from the previous quarter. 

During the first two months of the fourth quarter, U.S. refinery crude-input
volumes decreased by 77,000 barrels per day compared to the third quarter,
driven primarily by the continued shutdown of the Richmond, California refinery
crude unit. A return to normal operations at the Pascagoula, Mississippi
refinery post Hurricane Isaac partly offset the decrease. International refinery
crude-input volumes increased 9,000 barrels per day compared to the third
quarter. 

ALL OTHER

The company`s general guidance for the quarterly net after-tax charges related
to corporate and other activities is between $300 million and $400 million. Due
to the potential for non-ratable accruals related to income taxes, pension
settlements, environmental and other matters, actual results may significantly
differ from the guidance range. Total net charges for the fourth quarter are
expected to be notably higher than the general guidance range. 

NOTICE

Chevron`s discussion of fourth quarter 2012 earnings with security analysts will
take place on Friday, February 1, 2013, at 8:00 a.m. PST.A webcast of the
meeting will be available in a listen-only mode to individual investors, media,
and other interested parties on Chevron`s website at www.chevron.com under the
"Investors" section.Additional financial and operating information will be
contained in the Earnings Supplement that will be available under "Events &
Presentations" in the "Investors" section on the website.

CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION

FOR THE PURPOSE OF "SAFE HARBOR'' PROVISIONS OF THE

PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This interim update of Chevron Corporation contains forward-looking statements
relating to Chevron`s operations that are based on management`s current
expectations, estimates and projections about the petroleum, chemicals and other
energy-related industries. Words such as "anticipates," "expects," "intends,"
"plans," "targets," "forecasts," "projects," "believes," "seeks," "schedules,"
"estimates," "budgets," "outlook" and similar expressions are intended to
identify such forward-looking statements. These statements are not guarantees of
future performance and are subject to certain risks, uncertainties and other
factors, many of which are beyond the company`s control and are difficult to
predict. Therefore, actual outcomes and results may differ materially from what
is expressed or forecasted in such forward-looking statements. The reader should
not place undue reliance on these forward-looking statements, which speak only
as of the date of this interim update. Unless legally required, Chevron
undertakes no obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or otherwise.

Among the important factors that could cause actual results to differ materially
from those in the forward-looking statements are: changing crude oil and natural
gas prices; changing refining, marketing and chemical margins; actions of
competitors or regulators; timing of exploration expenses; timing of crude oil
liftings; the competitiveness of alternate-energy sources or product
substitutes; technological developments; the results of operations and financial
condition of equity affiliates; the inability or failure of the company`s
joint-venture partners to fund their share of operations and development
activities; the potential failure to achieve expected net production from
existing and future crude oil and natural gas development projects; potential
delays in the development, construction or start-up of planned projects; the
potential disruption or interruption of the company`s production or
manufacturing facilities or delivery/transportation networks due to war,
accidents, political events, civil unrest, severe weather or crude oil
production quotas that might be imposed by the Organization of Petroleum
Exporting Countries; the potential liability for remedial actions or assessments
required by existing or future environmental regulations and litigation;
significant investment or product changes required by existing or future
environmental statutes, regulations and litigation; the potential liability
resulting from other pending or future litigation; the company`s future
acquisition or disposition of assets and gains and losses from asset
dispositions or impairments; government-mandated sales, divestitures,
recapitalizations, industry-specific taxes, changes in fiscal terms or
restrictions on scope of company operations; foreign currency movements compared
with the U.S. dollar; the effects of changed accounting rules under generally
accepted accounting principles promulgated by rule-setting bodies; and the
factors set forth under the heading "Risk Factors" on pages 29 through 31 of the
company`s 2011 Annual Report on Form 10-K. In addition, such results could be
affected by general domestic and international economic and political
conditions. Other unpredictable or unknown factors not discussed in this interim
update could also have material adverse effects on forward-looking statements.

Chevron Corporation
Justin Higgs, 925-842-6175 

Copyright Business Wire 2013
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