Chevron profit rises on refining gains, asset swap

Fri Feb 1, 2013 9:24am EST

Motorists are shown at gas pumps at a Chevron gasoline station in Burbank, California July 31, 2009. REUTERS/Fred Prouser

Motorists are shown at gas pumps at a Chevron gasoline station in Burbank, California July 31, 2009.

Credit: Reuters/Fred Prouser

(Reuters) - Chevron Corp (CVX.N) posted a larger-than-expected rise in quarterly profit on Friday as its refining arm managed to improve earnings despite a fire that crippled the company's oldest refinery last August.

The second-largest U.S. oil producer said fourth-quarter net income rose to $7.2 billion, or $3.70 per share, from $5.1 billion, or $2.58 per share, a year earlier.

The results included a gain of $1.4 billion from a deal with Royal Dutch Shell Plc (RDSa.L), announced in August, in which Shell swapped interests in two fields off Australia for Chevron's holdings in the Browse liquefied natural gas project in Australia.

Leaving out one-time items, Chevron earned $3.27 per share, topping analysts' average estimate of $3.03, according to Thomson Reuters I/B/E/S.

Shares of Chevron rose 0.4 percent to $115.64 in premarket trading.

Including the asset swap gain, earnings in the oil and gas production business rose 20 percent to $6.9 billion, and refining operations posted a profit of $925 million, compared with a loss of $61 million a year before.

Chief Executive John Watson said the company has now led the industry in earnings per barrel from oil and gas production for three years. "Our downstream businesses also delivered highly competitive earnings per barrel," he said in a statement.

Fourth-quarter upstream production was 2.67 million barrels of oil equivalent per day, up from 2.64 million bpd a year earlier.

Increasing output from the wellhead has been a struggle this year for Chevron and for Exxon Mobil Corp (XOM.N), Shell (RDSa.L) and ConocoPhillips (COP.N). Shares of Conoco fell on Thursday after its production outlook disappointed investors.

Chevron is still trying to get its Richmond refinery in California recovered from the fire that damaged its crude unit, which is expected to be fixed this quarter. The state's workplace safety regulators slapped a record fine on Chevron on Wednesday in connection with the accident.

(Reporting by Braden Reddall in San Francisco; editing by John Wallace)

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Comments (3)
bates148 wrote:
Many of the folks who will come on here and complain about this are Democrats living in blue states. Look, if you want to see the price of gas come down, put pressure on your politicians to lower the tax on it. In the meantime, keep your mouth shut about companies making profits.

Feb 01, 2013 9:53am EST  --  Report as abuse
Harry079 wrote:
“The state’s workplace safety regulators slapped a record fine on Chevron on Wednesday in connection with the accident.”

Funny you didn’t mention how much the fine was or if anyone was killed or injured. But hey as long as they are making a ton of money who cares?

Feb 01, 2013 10:56am EST  --  Report as abuse
Harry079 wrote:
Nearly $1 million fine. One worker slightly injured.

“In all, the state Division of Occupational Safety and Health issued 25 citations against California’s biggest oil company, including 11 “willful serious” and 12 lesser “serious” violations related to the Aug. 6 blaze, the state said.”

Go Chevron!

Feb 01, 2013 11:01am EST  --  Report as abuse
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