Chevron Will Boost Capital Spending in 2019

Friday, December 7, 2018

Chevron Corp plans to spend $20 billion next year on oil and natural gas projects, the second-largest U.S. oil producer said on Thursday in a statement, its first increase in four years.

Its 2019 capital spending budget is at the high end of an $18 billion to $20 billion per-year range that Chevron executives set earlier this year as the annual target through 2020.

The company has said it expects to spend $19.8 billion this year.

San Ramon, California-based Chevron and other energy companies have pledged to restrain spending after the oil-price collapse earlier this decade forced many to borrow to cover their costs of expensive and long-term projects.

"Operating cash flow is strong, so it should be able to cover spending along with the dividend,” said Brian Youngberg, an oil and gas analyst with investment firm Edward Jones.

Among the highlights of its budget, Chevron plans to spend more on shale production next year and more on investments in refining and chemicals, according to its spending projection.

It plans to spend $3.6 billion in the Permian Basin of West Texas and New Mexico and $1.6 billion for other shale regions, or $5.2 billion in total, up from $4.3 billion on such investments this year.

Two-thirds of the 2019 budget will go toward projects that "realize cash flow within two years," Chief Executive Michael Wirth said in a statement.

Chevron also said it would spend $4.3 billion on the giant Tengiz field in Kazakhstan, up from the $3.7 billion budgeted this year.

About $2.5 billion of planned spending will go towards its business that refines, transports and markets fuels and petrochemicals, up $300 million from the amount it projected to spend this year.

Most oil producers have yet to disclose their 2019 budgets, which generally are released in December and January.

Chevron shares were off $1.33 on Thursday, to $115.91 per share and are down 7.4 percent year to date.


(Reporting by Jennifer Hiller; editing by Diane Craft and Chris Reese)

Categories: Shale Finance Energy Offshore Energy Shale Oil & Gas Drilling Engineering Oil Production

Related Stories

Pharos Energy Kicks Off Drilling Campaign Offshore Vietnam

US Pressure on India Could Propel Russia's Shadow Oil Exports

Timor Gap Boosts Stake in Finder Energy’s Timor-Leste Oil Fields

Brownfield Output Decline Accelerates, says IEA

PV Drilling Takes Ownership of Noble Corporation’s Stacked Jack-Up Rig

CNOOC Brings Online Another Oil and Gas Project in South China Sea

SPE Offshore Europe 2025 set to drive transformational change for the energy sector

Norwegian Oil Investment Will Peak in '25

Valeura Energy, PTTEP Partner Up on Gulf of Thailand Blocks

China Starts Production at Major Oil Field in Bohai Sea

Current News

Malaysia’s Petronas and Oman’s OQEP Strengthen Oil and Gas Ties

Southeast Asia’s 2GW Cross-Border Offshore Wind Scheme Targets 2034 Buildout

Pharos Energy Kicks Off Drilling Campaign Offshore Vietnam

Viridien to Shed More Light on Malaysia’s Offshore Oil and Gas Potential

US Pressure on India Could Propel Russia's Shadow Oil Exports

Energy Drilling’s EDrill-2 Rig Starts Ops for PTTEP in Gulf of Thailand

RINA Wins FEED Contract for Petronas’ Flagship CCS Project in Malaysia

ABL Secures Rig Moving Assignment with India's ONGC

Pakistan, Türkiye Deepen Oil and Gas Ties with Offshore Indus-C Block Deal

Eni-Petronas Gas Joint Venture Up for Launch in 2026

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com