Chevron posted a $35.5 billion net profit for 2022, more than double the $15.6 billion reported in 2021, despite flagging $1.1 billion in international write-offs and impairments in the fourth quarter.

The California-based company’s quarterly earnings of $6.4 billion were 25% higher than the same period in 2021.

Chevron announced soaring profits just two days after the White House had criticised its decision to spend another $75 billion on share repurchases, rather than on investment in production and boosting energy supply.

A previous buy-back programme set in 2019 saw Chevron repurchasing $25 billion of the company's shares by 31 March 2023. The new programme has no fixed expiration date.

In 2021, Chevron paid out $26 billion in dividends and buy-backs to shareholders and invested $15.7 billion in operations and is set to triple this in the next five years.

Chevron executives have shrugged off criticism, insisting there will be enough cash available to strengthen production and to continue reducing debt, as well as rewarding shareholders.

“We don’t want to be authorising a programme every year, so we talked to the board about a multi-year outlook,” Chevron chief executive Mike Wirth said during the earnings presentation.

“I think it’s perhaps been a touch overblown given that it’s an open-ended programme. We could have sized a smaller one and been prepared to do another one sooner.”

In 2023, the company will increase capital expenditure to $17 billion. Two-thirds of this is allocated to the US, where oil and gas output was up 4% compared with 2021 to reach 1.2 million barrels of oil equivalent per day, helped by a big 16% increase in Permian basin unconventional production.

Chevron’s global oil and gas production was down for the year, due in part to the expiry of concessions in Thailand and production sharing contracts in Indonesia.

“We delivered record earnings and cash flow in 2022, while increasing investments and growing US production to a company record,” Wirth said.

East Mediterranean

All eyes are currently on the East Mediterranean, where Chevron at the end of 2022 took the final investment decision to expand the Tamar gas field project offshore Israel, bringing expected production from 1.1 billion cubic feet per day to 1.6 Bcfd.

Wirth during the earnings presentation said the company is also considering expansions to its Leviathan gas project offshore Israel. Chevron in 2020 acquired Noble Energy, which had a stake in the project. Now, Wirth said, Chevron is narrowing expansion concepts for later this year.

“The region needs gas… regionally in the Middle East, [and there are] also options to try to get that gas into Europe,” Wirth said.

“The Noble Energy acquisition was really advantageous from that standpoint, and we’re optimistic about the prospectivity of some of these additional exploration blocks.”

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