Dec 11 Chevron Corp plans to spend $39.8 billion on projects and exploration in 2014, the second-largest U.S. oil company said on Wednesday, as it finishes work on huge developments in Australia and the Gulf of Mexico.
Investors are putting increased pressure on the world's biggest oil companies to rein in spending and return more money to shareholders - a trend Royal Dutch Shell Plc recently warned against because it may create oil shortages in the future.
Chevron's latest capital and exploratory budget compares with $42 billion in expected investments this year, far more than the $36.7 billion the company originally budgeted. Larger rival Exxon Mobil Corp's 2013 budget was $38 billion.
In a statement, Chief Executive John Watson said 2013 would be "a relative peak year for investments," while 2014 would be a peak year for spending on the company's Australian liquefied natural gas projects.
Chevron was forced to add billions to the total cost of the Gorgon liquefied natural gas (LNG) export complex in Australia - a $54 billion giant where costs were inflated by labor shortages and foreign exchange movements.
Chevron owns 47 percent of Gorgon, while Exxon and Shell each hold 25 percent stakes and the rest is shared by Japanese LNG buyers.
Chevron's overall LNG production, including that from another Australian plant being built called Wheatstone and a newly opened development in Angola, is expected to double to the oil-equivalent of 460,000 barrels per day (boepd) in 2017.
That is a major part of the production Chevron plans to add as it pursues its 2017 production target of 3.3 million boepd, up from about 2.6 million currently.
Closer to home, Chevron has three projects in the works in the Gulf of Mexico: Jack/St Malo, Big Foot and Tubular Bells. The Jack/St. Malo project is scheduled to start next year, while the Big Foot project is forecast to start in the second quarter of 2015, Chevron said.
The San Ramon, California-based company also included in its list of major projects the expansion of the Caspian Pipeline in Kazakhstan and Russia and development of the Usan and Agbami deepwater fields in Nigeria, among others.
As for the "downstream" budget for refining and chemicals, Chevron set that at $3.1 billion, compared with a budget of $2.7 billion this year.