Released February 08, 2024 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Full-year 2023 earnings plunged from year-earlier historic levels at four large integrated supermajor oil companies--Exxon Mobil Corporation (NYSE:XOM) (Spring, Texas), Chevron Corporation (NYSE:CVX) (San Ramon, California), Shell plc (NYSE:SHEL) (London, England) and BP (NYSE:BP) (London)--as one-time charges, lower commodity prices and reduced margins offset the effects of rising production and organizational cost-cutting.
On a full-year basis, using Generally Accepted Accounting Principles (GAAP), the four companies earned a healthy $90.6 billion, a recent high. But 2023 profits trailed the historic level of $161.2 billion in 2022. Full-year profits for oil producers hit historic levels in 2022 after Russia's invasion of Ukraine drove up crude oil and natural gas prices.
The four companies earned $13 billion in the just completed quarter, down sharply from $34.5 billion in the year-earlier quarter and $29.6 billion in the fourth quarter of 2021.
Results for the four companies are summarized below.
ExxonMobil
The largest U.S.-based producer of oil and gas on February 2 reported fourth-quarter profits fell 40%, to $7.6 billion from $12.750 billion in the year-earlier quarter. Quarterly results were hurt by a $2 billion impairment stemming from "regulatory obstacles in California that have prevented production and distribution assets from coming back online." But those items were partly offset by asset sales and positive one-time items.
Annual profits for ExxonMobil fell 35% to $36 billion from $55 billion in 2022.
ExxonMobil's subsidiaries and partners are involved with about 200 capital projects globally worth about $70.1 billion, according to Industrial Info Resources' Global Market Intelligence (GMI) platform. These capital projects will take place in these industries: Oil and Gas Production, Chemical Processing and Power. By country, the planned capital spend is scheduled to take place in the U.S., Mozambique, Vietnam, Guyana and China.
Exxon's earnings statement said that during 2023, the company:
Full-year production was flat year-over-year at about 3.7 million barrels of oil equivalent per day (BOE/d). Payara, the company's third Guyana development, started up in November, ahead of schedule, and production reached nameplate capacity of 220,000 barrels per day in mid-January.
"Our consistent strategy and execution excellence across the business delivered industry-leading earnings and enabled us to return more cash to shareholders than our peers in 2023," said Darren Woods, chairman and chief executive officer of ExxonMobil.
He continued: "These results demonstrate the fundamental improvements we've made to our business, reflecting our progress in high-grading our portfolio through investments in advantaged projects and select divestments, while, at the same time, driving a higher level of efficiency and effectiveness throughout the business."
"The foundation of our success comes from the resiliency, hard work and commitment of our people" he said.
Chevron
Chevron's fourth-quarter earnings sank to $2.3 billion from $6.4 billion in the comparable year-earlier quarter. Full-year profits fell to $21.4 billion from $35.5 billion in 2022. In reporting earnings February 2, the company noted that one-time items lowered fourth-quarter profits by about $4.2 billion.
The exploration and production business accounted for more than half of the company's profits, as has been the case historically, but the share from refining and marketing rose both in 2023's fourth-quarter and for the full year.
Commenting on the company's financial results, Chairman and Chief Executive Mike Wirth said, "In 2023, we returned more cash to shareholders and produced more oil and natural gas than any year in the company's history." Cash returned to shareholders totaled about $26.3 billion for the year, 18% more than in 2022, and annual worldwide net oil-equivalent production increased to more than 3.1 million BOE/d per day, led by 14% growth in the United States, the company added.
Chevron made a number of strategic transactions last year, including closing its acquisition of PDC Energy Incorporated (Denver, Colorado), a producer with a significant presence in the Permian and Denver-Julesburg (D-J) basins, and a majority stake in ACES Delta LLC, which is developing a green hydrogen production and energy storage facility in Delta, Utah. Chevron also announced it acquired Hess Corporation (NYSE:HES) (New York, New York) last year, but that deal has not yet closed. For more on that transaction, see October 24, 2023, article - Chevron to Buy Hess, Add Bakken Shale to Oil & Gas Holdings.
Production growth in the Permian, plus the acquisition of PDC Energy, helped boost Chevron's worldwide production by 4% to slightly more than 1.3 million BOE/d, up from 1.2 million BOE/d in 2022.
Wirth said Chevron "strengthened our portfolio with traditional and new energy acquisitions to help meet the growing demand for affordable, reliable and ever-cleaner energy."
Capital outlays, not including the PDC Energy acquisition, rose 32% last year, the company said in its February 2 earnings statement. The company said it paid down about $4 billion of debt in 2023, including all the funds borrowed to acquire PDC Energy.
Chevron also increased its common-stock dividend 8%, to $1.63 per share.
According to IIR's GMI platform, Chevron's subsidiaries and partners are involved with about 116 capital projects around the world valued at approximately $30 billion. Capital spending is concentrated in the Oil and Gas Production and Chemical Processing industries. Most of Chevron's capital spending is projected to take place in the U.S., followed by sharply lower levels of CapX spending expected in Kazakhstan, Israel, Angola and Australia.
Shell
Like its Big Oil brethren, Shell's earnings statement, released February 1, emphasized adjusted earnings, which is not a GAAP measure.
On a GAAP basis, Shell earned $474 million in the just-completed quarter, down sharply from the $10.4 billion it earned in the comparable year-earlier quarter. On a full-year basis, GAAP earnings were $19.4 billion in 2023, down 54% from 2022 profits of $42.3 billion.
"Shell delivered another quarter of strong performance, concluding a year in which we made good progress across the targets outlined at our Capital Markets Day" last June, Shell Chief Executive Officer Wael Sawan said. "As we enter 2024, we are continuing to simplify our organization with a focus on delivering more value with less emissions."
Shell's subsidiaries and partners are involved with about 636 capital projects around the world worth an estimated $190 billion, according to Industrial Info Resources' GMI platform. The spending is expected to take place mainly in the Oil and Gas Production, Power and Chemical Processing industries. On a country basis, capital projects involving Shell are concentrated in U.K., U.S., Brazil and Canada.
The company said it returned $23 billion to shareholders in 2023, which was more than 40% of cash flow from operations. In its February 1 earnings statement, it also said it was increasing its common stock dividend 4% and that it would buy back $3.5 billion of its shares over the next three months.
Full-year 2023 income attributable to Shell plc shareholders, compared with the full-year 2022 results, reflected lower realized oil and gas prices, lower production volumes and lower refining margins. But these were partly offset by higher liquefied natural gas (LNG) trading and optimization margins and higher margins in its refining and marketing business.
By focusing its portfolio and simplifying its organization, Shell was able to achieve about $1 billion of pre-tax structural cost reductions last year, mainly the result of asset sales. It is seeking another $1 billion to $2 billion in structural cost cuts by yearend 2025.
Full-year results were hampered by about $8.2 billion of charges that reflected asset impairment charges and mark-to-market changes in accounting for the value of commodities. By contrast, those items added $1.2 billion to Shell's earnings in 2022.
Shell's said its capital expenditures in 2023 were about $24.4 billion. The company said it plans to make $22 billion to $25 billion in capital outlays this year.
BP
BP earned $3 billion in the just-completed quarter, down 38% from the $4.8 billion in earnings for the comparable year-earlier period. Full-year profit was $13.8 billion, down 50% from profits of $27.7 billion in 2022.
BP's subsidiaries and partners are involved with approximately 309 capital projects around world valued at about $53.2 billion. The industries slated to draw capital dollars are the Oil and Gas Production, Power, Chemical Processing, Petroleum Refining and Oil and Gas Pipelines industries. Geographically, the markets drawing the largest amount of capital spending are the U.K., U.S., Australia, Azerbaijan and Oman.
"Looking back, 2023 was a year of strong operational performance with real momentum in delivery right across the business. And as we look ahead, our destination remains unchanged -- from OIC (integrated oil company) to IEC (Integrated energy company) -- focused on growing the value of BP," Chief Executive Murray Auchincloss said in a February 6 earnings statement. "We are confident in our strategy, on delivering as a simpler, more focused and higher-value company, and committed to growing long-term value for our shareholders."
In reporting results, BP also announced a $1.75 billion share buyback that will take place during the first quarter. A further buyback program of $1.75 billion is expected in the second quarter. Through 2025, the company said it plans to repurchase about $14 billion of its common stock.
BP's LNG business grew about 16% by volume during 2023, to about 23 million tons per year from 19 million tons per year in 2022. Its U.S. unit, BPX, reported a 13% gain in production. The London-based firm reported four major oil and gas exploration and production projects last year. Electric-vehicle charge points rose 35% last year while its renewables project pipeline shot up 57%, to 58.3 gigawatts (GW) from 27.2 GW.
In announcing earnings, the company restates its longstanding belief that "The world's transition to a more secure, more affordable, lower carbon energy system needs massive investment in lower carbon energies AND continued investment in oil and gas as the alternatives grow. We're transforming BP to play our part."
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
On a full-year basis, using Generally Accepted Accounting Principles (GAAP), the four companies earned a healthy $90.6 billion, a recent high. But 2023 profits trailed the historic level of $161.2 billion in 2022. Full-year profits for oil producers hit historic levels in 2022 after Russia's invasion of Ukraine drove up crude oil and natural gas prices.
The four companies earned $13 billion in the just completed quarter, down sharply from $34.5 billion in the year-earlier quarter and $29.6 billion in the fourth quarter of 2021.
Results for the four companies are summarized below.
ExxonMobil
The largest U.S.-based producer of oil and gas on February 2 reported fourth-quarter profits fell 40%, to $7.6 billion from $12.750 billion in the year-earlier quarter. Quarterly results were hurt by a $2 billion impairment stemming from "regulatory obstacles in California that have prevented production and distribution assets from coming back online." But those items were partly offset by asset sales and positive one-time items.
Annual profits for ExxonMobil fell 35% to $36 billion from $55 billion in 2022.
ExxonMobil's subsidiaries and partners are involved with about 200 capital projects globally worth about $70.1 billion, according to Industrial Info Resources' Global Market Intelligence (GMI) platform. These capital projects will take place in these industries: Oil and Gas Production, Chemical Processing and Power. By country, the planned capital spend is scheduled to take place in the U.S., Mozambique, Vietnam, Guyana and China.
Exxon's earnings statement said that during 2023, the company:
- Increased Guyana and Permian production by 18% vs. 2022 and achieved record annual refinery throughput
- Strengthened its portfolio with $4.1 billion of non-core asset divestments and two acquisitions: one that accelerates its Low Carbon Solutions business and one that will transform the exploration & production business
- Launched new MobilTM Lithium business with the potential to supply up to one million electric vehicles per year by 2030.
Full-year production was flat year-over-year at about 3.7 million barrels of oil equivalent per day (BOE/d). Payara, the company's third Guyana development, started up in November, ahead of schedule, and production reached nameplate capacity of 220,000 barrels per day in mid-January.
"Our consistent strategy and execution excellence across the business delivered industry-leading earnings and enabled us to return more cash to shareholders than our peers in 2023," said Darren Woods, chairman and chief executive officer of ExxonMobil.
He continued: "These results demonstrate the fundamental improvements we've made to our business, reflecting our progress in high-grading our portfolio through investments in advantaged projects and select divestments, while, at the same time, driving a higher level of efficiency and effectiveness throughout the business."
"The foundation of our success comes from the resiliency, hard work and commitment of our people" he said.
Chevron
Chevron's fourth-quarter earnings sank to $2.3 billion from $6.4 billion in the comparable year-earlier quarter. Full-year profits fell to $21.4 billion from $35.5 billion in 2022. In reporting earnings February 2, the company noted that one-time items lowered fourth-quarter profits by about $4.2 billion.
The exploration and production business accounted for more than half of the company's profits, as has been the case historically, but the share from refining and marketing rose both in 2023's fourth-quarter and for the full year.
Commenting on the company's financial results, Chairman and Chief Executive Mike Wirth said, "In 2023, we returned more cash to shareholders and produced more oil and natural gas than any year in the company's history." Cash returned to shareholders totaled about $26.3 billion for the year, 18% more than in 2022, and annual worldwide net oil-equivalent production increased to more than 3.1 million BOE/d per day, led by 14% growth in the United States, the company added.
Chevron made a number of strategic transactions last year, including closing its acquisition of PDC Energy Incorporated (Denver, Colorado), a producer with a significant presence in the Permian and Denver-Julesburg (D-J) basins, and a majority stake in ACES Delta LLC, which is developing a green hydrogen production and energy storage facility in Delta, Utah. Chevron also announced it acquired Hess Corporation (NYSE:HES) (New York, New York) last year, but that deal has not yet closed. For more on that transaction, see October 24, 2023, article - Chevron to Buy Hess, Add Bakken Shale to Oil & Gas Holdings.
Production growth in the Permian, plus the acquisition of PDC Energy, helped boost Chevron's worldwide production by 4% to slightly more than 1.3 million BOE/d, up from 1.2 million BOE/d in 2022.
Wirth said Chevron "strengthened our portfolio with traditional and new energy acquisitions to help meet the growing demand for affordable, reliable and ever-cleaner energy."
Capital outlays, not including the PDC Energy acquisition, rose 32% last year, the company said in its February 2 earnings statement. The company said it paid down about $4 billion of debt in 2023, including all the funds borrowed to acquire PDC Energy.
Chevron also increased its common-stock dividend 8%, to $1.63 per share.
According to IIR's GMI platform, Chevron's subsidiaries and partners are involved with about 116 capital projects around the world valued at approximately $30 billion. Capital spending is concentrated in the Oil and Gas Production and Chemical Processing industries. Most of Chevron's capital spending is projected to take place in the U.S., followed by sharply lower levels of CapX spending expected in Kazakhstan, Israel, Angola and Australia.
Shell
Like its Big Oil brethren, Shell's earnings statement, released February 1, emphasized adjusted earnings, which is not a GAAP measure.
On a GAAP basis, Shell earned $474 million in the just-completed quarter, down sharply from the $10.4 billion it earned in the comparable year-earlier quarter. On a full-year basis, GAAP earnings were $19.4 billion in 2023, down 54% from 2022 profits of $42.3 billion.
"Shell delivered another quarter of strong performance, concluding a year in which we made good progress across the targets outlined at our Capital Markets Day" last June, Shell Chief Executive Officer Wael Sawan said. "As we enter 2024, we are continuing to simplify our organization with a focus on delivering more value with less emissions."
Shell's subsidiaries and partners are involved with about 636 capital projects around the world worth an estimated $190 billion, according to Industrial Info Resources' GMI platform. The spending is expected to take place mainly in the Oil and Gas Production, Power and Chemical Processing industries. On a country basis, capital projects involving Shell are concentrated in U.K., U.S., Brazil and Canada.
The company said it returned $23 billion to shareholders in 2023, which was more than 40% of cash flow from operations. In its February 1 earnings statement, it also said it was increasing its common stock dividend 4% and that it would buy back $3.5 billion of its shares over the next three months.
Full-year 2023 income attributable to Shell plc shareholders, compared with the full-year 2022 results, reflected lower realized oil and gas prices, lower production volumes and lower refining margins. But these were partly offset by higher liquefied natural gas (LNG) trading and optimization margins and higher margins in its refining and marketing business.
By focusing its portfolio and simplifying its organization, Shell was able to achieve about $1 billion of pre-tax structural cost reductions last year, mainly the result of asset sales. It is seeking another $1 billion to $2 billion in structural cost cuts by yearend 2025.
Full-year results were hampered by about $8.2 billion of charges that reflected asset impairment charges and mark-to-market changes in accounting for the value of commodities. By contrast, those items added $1.2 billion to Shell's earnings in 2022.
Shell's said its capital expenditures in 2023 were about $24.4 billion. The company said it plans to make $22 billion to $25 billion in capital outlays this year.
BP
BP earned $3 billion in the just-completed quarter, down 38% from the $4.8 billion in earnings for the comparable year-earlier period. Full-year profit was $13.8 billion, down 50% from profits of $27.7 billion in 2022.
BP's subsidiaries and partners are involved with approximately 309 capital projects around world valued at about $53.2 billion. The industries slated to draw capital dollars are the Oil and Gas Production, Power, Chemical Processing, Petroleum Refining and Oil and Gas Pipelines industries. Geographically, the markets drawing the largest amount of capital spending are the U.K., U.S., Australia, Azerbaijan and Oman.
"Looking back, 2023 was a year of strong operational performance with real momentum in delivery right across the business. And as we look ahead, our destination remains unchanged -- from OIC (integrated oil company) to IEC (Integrated energy company) -- focused on growing the value of BP," Chief Executive Murray Auchincloss said in a February 6 earnings statement. "We are confident in our strategy, on delivering as a simpler, more focused and higher-value company, and committed to growing long-term value for our shareholders."
In reporting results, BP also announced a $1.75 billion share buyback that will take place during the first quarter. A further buyback program of $1.75 billion is expected in the second quarter. Through 2025, the company said it plans to repurchase about $14 billion of its common stock.
BP's LNG business grew about 16% by volume during 2023, to about 23 million tons per year from 19 million tons per year in 2022. Its U.S. unit, BPX, reported a 13% gain in production. The London-based firm reported four major oil and gas exploration and production projects last year. Electric-vehicle charge points rose 35% last year while its renewables project pipeline shot up 57%, to 58.3 gigawatts (GW) from 27.2 GW.
In announcing earnings, the company restates its longstanding belief that "The world's transition to a more secure, more affordable, lower carbon energy system needs massive investment in lower carbon energies AND continued investment in oil and gas as the alternatives grow. We're transforming BP to play our part."
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
