New York (AFP) – US oil and gas giant ExxonMobil reported higher profits Friday as it pointed to the benefits of its acquisition of Pioneer Natural Resources, while earnings at rival Chevron dipped on lower refining results.
ExxonMobil rode the contribution from Pioneer, a big player in the Permian Basin in Texas and New Mexico, to record oil and gas output during the quarter. Profits at ExxonMobil jumped 17 percent to $9.2 billion on a 12 percent increase in revenues to $93.1 billion, topping analyst estimates on both counts. The petroleum heavyweight pointed to a lift in output from the Permian Basin following the Pioneer deal, which has also put the company on track for higher capital spending this year.
Another bright spot is ExxonMobil’s venture in Guyana, where the company during the second quarter filed an application for a seventh development with Guyanese officials, with anticipated startup in 2029. These upstream highlights made up for a sharp drop in energy products due to excess supply of petroleum products that weakened profit margins.
Meanwhile, Chevron reported profits of $4.4 billion, down 26 percent from the year-ago period on revenues of $51.2 billion, up five percent. Upstream profits fell somewhat compared to the year-ago period, with Chevron citing downtime in Australia and an exit from Myanmar, offsetting higher volumes in the United States. The bigger hit to Chevron’s results was in the downstream, where profits fell by 60 percent due to weak profit margins.
Chevron’s outlook has also been clouded by uncertainty surrounding its proposed $53 billion takeover of US oil company Hess. The deal, which was announced in October, has been significantly delayed by ExxonMobil, which has argued it has “pre-emption rights” on the Stabroek venture in Guyana in which Hess has a stake. Chevron has said it could exit the Hess deal if it doesn’t include Guyana. The case is going to arbitration.
On Wednesday, Chevron disclosed that the arbitration hearing would take place in May 2025, with a decision expected in the following three months. Chevron, which had previously hoped for the arbitration hearing in 2024, “had expected and requested that this hearing be held earlier, but the arbitrators’ common schedules did not make this possible,” the company said in a securities filing.
ExxonMobil, which announced its Pioneer deal about two weeks before Chevron unveiled the Hess transaction, appeared to allude to the Hess deal delay in the company’s press release. “We closed on our transformative merger with Pioneer in about half the time of similar deals,” said ExxonMobil Chief Executive Darren Woods. ExxonMobil completed the $60 billion takeover of Pioneer in early May.
Shares of ExxonMobil fell 0.4 percent, while Chevron fell 1.9 percent in pre-market trading.
© 2024 AFP
