Thanks to the rising crude prices and sale of a refinery, Chevron Corporation (NYSE:CVX) third quarter profit more than doubled this year, even as company’s production failed to meet expectations.
The San Ramon, California-based Chevron said it earned $7.8 billion, or $3.92a share, last quarter, compared to a profit of $3.8 billion, or $1.87a share, a year earlier.
Analysts had expected a smaller profit of $3.48 per share.
Revenue during the July-September quarter leaped 30 percent to $64.4 billion from $49.7 billion in the previous year, but trailed the analyst projections of $70.4 billion.
Chevron’s average sale price of a barrel of crude oil hit $97 in the quarter, well above $69 a year earlier in the same period.
Moreover, the company’s average sale price of natural gas liquids was $4.14 per thousand cubic feet in the third quarter compared to $4.06 last year.
Despite a 5 percent drop in production, the company’s upstream operations, including the exploration and production units, generated $6.2 billion in profit, a 74 percent increase from third quarter in 2010.
Energy production slipped
Chevron’s global net oil-equivalent production slumped to 2.6 million barrels per day in the last three months, down from 2.74 million barrels in the same quarter last year.
According to the company, production was hampered by two hurricanes in the Gulf of Mexico, maintenance related work at oil installations, and less output at some joint ventures overseas.
“Production increases from project ramp-ups in Canada, the U.S. and Brazil and new volumes stemming from the acquisition of Atlas Energy Inc. were more than offset by maintenance-related downtime (and) normal field declines,” the company said.
Upstream and downstream operations
Despite a 5 percent drop in production, the company’s upstream operations, including the exploration and production units generated $6.2 billion in profit, a 74 percent increase from third quarter in 2010.
Moreover, Chevron’s downstream operations reported a profit of $1.986 billion, including $500 million from the sale of its British refinery to Valero Energy.
Chairman and CEO John Watson stated, “We had another successful quarter, with both strong earnings and cash flow. Current quarter earnings for our upstream operations benefited from higher crude oil prices on world markets.
"At the same time, gains on asset sales and improved margins for refined petroleum products contributed to increased earnings for our downstream businesses.”