ExxonMobil Doubles 2Q Profit
ExxonMobil's second quarter profits almost doubled in 2Q2017 thanks to higher prices.
The US supermajor said July 28 net earnings were up 97% year on year to $3.35bn. CEO Darren Woods said: “These solid results across our businesses were driven by higher commodity prices and a continued focus on operations and business fundamentals.”
Upstream volumes declined 1% to 3.9mn barrels of oil equivalent/day largely because of lower entitlements, but increases from projects and work programs more than offset field declines. Exxon announced phase 1 of its world-class Guyana Liza development was funded, with first oil by 2020.
Liquids output of 2.3mn b/d was 61,000 b/d lower year on year. Gas production at 9.9bn ft3/d was up 158mn ft3/d (up 1.6%) as project ramp-up, primarily in Australia, was partly offset by field decline and lower demand. However that total included European gas output down 17.5% at 1.44bn ft3/d, with the reduced production cap at the Groningen gasfield – where a joint Shell-Exxon venture is operator with 60% equity – the main factor. Last year the Dutch government agreed to cap the country's largest field at 24bn m³/yr (2.32bn ft3/d) for the five-year period from October 2016 to September 2021. But this year the government said it wanted a further 10% cut to 21.6bn m³/yr from October 2017 to Sept.2021; a judicial ruling in November may cut that further.
Exxon's upstream earnings rose substantially to $1.2bn, with downstream earnings up 68% at $1.4bn. Chemical earnings were $985mn, down $232mn, owing to higher turnaround activities and lower margins. The company also reminded analysts of its positive results last month at the Muruk-1 sidetrack 3 well in Papua New Guinea, northwest of Hides gas field that supplies feedstock for PNG LNG.
Mark Smedley