(Adds Kitimat LNG information and Breakingviews link; updates
By Ernest Scheyder
Aug 1 Chevron Corp, the second-largest
U.S. oil company, reported better-than-expected quarterly profit
on Friday as higher energy prices offset rising expenses and
production dips in Kazakhstan.
Chevron's reliance on higher crude oil and natural gas
prices to boost results, even as production falls, mirrored
results from rival Exxon Mobil Corp on Thursday, and
underlined Wall Street's concerns that international energy
giants were not replenishing reserves fast enough.
The company is spending more than $20 billion on five new
projects it hopes will boost production 20 percent by 2017. One
project, the Gorgon liquefied natural gas (LNG) facility in
Australia, should be online by next year, executives said on a
conference call with investors.
Chevron reiterated on Friday it remained interested in
developing the Kitimat LNG project off the western coast of
Canada. The plans were thrown into doubt on Thursday, when joint
venture partner Apache Corp said it was pulling out.
"We need to get a new partner in. That needs to happen,"
Chevron Vice Chairman George Kirkland said on a conference call
However the project, which would chill natural gas produced
in British Columbia for export, needs to have contracts in hand
for 60 percent of production before Chevron decides to invest
funds for construction, Kirkland said.
"We're not going to do a project unless it's economic," he
Chevron is not interested in buying part of Apache's stake
in the Kitimat project, and would even consider selling a small
portion of its 50 percent stake, Kirkland said.
Chevron's net income rose to $5.67 billion, or $2.98 per
share, in the second quarter, from $5.37 billion, or $2.77 per
share, in the year-ago period.
Analysts expected earnings of $2.66 per share, according to
Thomson Reuters I/B/E/S.
Production fell 1.4 percent to 2.5 million barrels of oil
equivalent per day (boe/d).
Shares of Chevron fell 1 percent to $127.90 in afternoon
(Reporting by Ernest Scheyder; Editing by Franklin Paul and