Chevron sets record in free cash flow in Q3
US major Chevron on October 29 reported record-setting levels of free-cash flow on the back of higher realised prices for crude oil and natural gas.
Chevron set a record during the third quarter with $6.7bn in free cash flow. Net income of $6.1bn marked a reversal from the $207mn loss reported during Q3 2020.
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“Third quarter earnings were the highest since first quarter 2013 largely due to improved market conditions, strong operational performance and a lower cost structure,” CEO Mike Wirth said. “Our free cash flow during the quarter was the best ever reported by the company.”
Chevron realised an average selling price for a barrel of crude oil and natural gas liquids from its US upstream operations of $58, compared with $31 during Q3 2020. Its average sale price for US natural gas was $3.25/'000 ft3, up from $0.89 during the previous year’s Q3.
Upstream performance also improved for the company. Chevron said it recorded a 7% increase in output from Q3 2020 to 3.03mn barrels of oil equivalent/day, generating upstream earnings of $5.14bn, versus $235mn a year earlier. Downstream earnings were also up at $1.31bn versus $292mn in Q3 2020.
Spending during the first nine months of the year was lower, with capital expenditure of $8.1bn marking a 21% decrease from the same period last year.
Elsewhere, the company touted its diverse energy mix.
“We are focused on lowering the carbon intensity in our operations and seeking to grow lower carbon businesses along with our traditional business lines,” it said.
The company in September said it expected to invest more than $10bn through 2028 on efforts to improve its low-carbon segments. The commitment is more than triple its previous capital plans for the energy transition.