At the Chevron Corporation annual security analyst meeting in New York, executives reportedly expressed confidence in the long term energy business and highlighted its growth outlook through 2017. At the same time, company executives outlined near term actions to address the recent decline in commodity prices.
Chairman and CEO
John Watson, Chairman and CEO of Chevron said, “the fundamentals of the oil and gas business remain attractive for our company and investors, as our products are vital to a growing world economy. We are well positioned to manage through the recent drop in commodity prices and are taking several responsive actions, including curtailing capital spending and lowering costs. Over the next few years, we expect to deliver significant cash flow growth as projects currently under construction come online. Our intention is to demonstrate performance that will allow our 27 year history of successive increases in our annual dividend payout to continue.”
George Kirkland, Vice Chairman and Executive Vice President, Upstream commented on the company’s upstream portfolio strategies, and historical performance, including the company’s consistent exploration and resource capture success over the past decade. He also pointed out the upstream segment’s superior financial performance relative to industry peers, as well as its leading competitive cost structure. Kirkland said, “this was the fifth consecutive year we have lead the integrated peer group on earnings per barrel. Our base business is performing exceptionally well and is profitable, even in a lower price environment. Our large, diverse resource base allows us to be very responsive to market conditions, with flexibility to select only the most attractive opportunities to more forward.”
Jay Johnson, Senior Vice President, Upstream gave an overview of the specific actions being taken to manage capital outlays, lower costs and improve operating efficiencies, all of which will contribute to improving upstream cash flow. He also gave a comprehensive update on the company’s deep queue of projects and other future investment opportunities, emphasising their strong cash and value generation potential. He said, “we continue to make steady progress on our LNG and deepwater developments, and will continue to ramp up production from our shale and tight assets, particularly from our very attractive Permian Basin acreage position. We expect to achieve 20% production growth by 2017, a rate which is simply unmatched by our industry peers. More importantly, our new production is expected to have considerably higher margins than in our existing portfolio.”
Edited from press release by Claira Lloyd