• Earnings of $3.1 billion; adjusted earnings of $3.3 billion
• Cash flow from operations of $7.0 billion; free cash flow of $5.2 billion
• Resuming share repurchases, targeted at $2-3 billion per year

Chevron Corporation today reported earnings of $3.1 billion ($1.60 per share - diluted) for second quarter 2021, compared with a loss of $8.3 billion ($(4.44) per share - diluted) in second quarter 2020. Included in the current quarter were remediation charges associated with previously sold assets of $120 million and pension settlement costs of $115 million. Foreign currency effects increased earnings by $43 million. Adjusted earnings of $3.3 billion ($1.71 per share - diluted) in second quarter 2021 compares to an adjusted loss of $2.9 billion ($(1.56) per share - diluted) in second quarter 2020.

“Second quarter earnings were strong, reflecting improved market conditions, combined with transformation benefits and merger synergies,” said Mike Wirth, Chevron’s chairman and chief executive officer.

“Our free cash flow was the highest in two years due to solid operational and financial performance and lower capital spending,” Wirth added. “We will resume share repurchases in the third quarter at an expected rate of $2-3 billion per year.”

Chevron continued to exercise capital discipline with year-to-date capital spending down 32 percent from a year ago. The company recently sanctioned the Jansz-lo Compression project in Australia, which is expected to maintain an important source of clean-burning natural gas. GS Caltex, a 50 percent owned equity affiliate, also started up an olefins mixed-feed cracker and associated polyethylene unit at its Yeosu, South Korea refinery ahead of schedule and under budget.

In the second quarter, Chevron continued to pursue the development of renewable and lower carbon fuels. The company began to produce renewable diesel at its El Segundo, California refinery by co-processing bio-feedstock. The company also established its first branded compressed natural gas (CNG) station as part of its plan to sell renewable natural gas through more than 30 CNG stations in California by 2025. In addition, the company announced separate agreements to collaborate with Toyota Motor North America, Inc. and Cummins Inc. to advance its goal of building a commercially viable, large-scale hydrogen business.

UPSTREAM

Worldwide net oil-equivalent production was 3.13 million barrels per day in second quarter 2021, an increase of 5 percent from a year ago.

U.S. Upstream
U.S. upstream operations earned $1.4 billion in second quarter 2021, compared with a loss of $2.1 billion a year earlier. The improvement was primarily due to higher crude oil realizations and the absence of second quarter 2020 charges for special items including impairments, write-offs and severance accruals. Higher crude oil production also contributed to the improvement between periods.

The company’s average sales price per barrel of crude oil and natural gas liquids was $54 in second quarter 2021, up from $19 a year earlier. The average sales price of natural gas was $2.16 per thousand cubic feet in second quarter 2021, up from $0.81 in last year’s second quarter.

Net oil-equivalent production of 1.14 million barrels per day in second quarter 2021 was up 145,000 barrels per day from a year earlier. The increase was due to an additional 227,000 barrels per day of production following the Noble Energy acquisition and lower production curtailments, partially offset by a 68,000 barrels per day decrease related to the Appalachian asset sale and lower production due to normal field declines. The net liquids component of oil-equivalent production in second quarter 2021 increased 15 percent to 857,000 barrels per day, and net natural gas production also increased 15 percent to 1.68 billion cubic feet per day, compared to last year’s second quarter.

International Upstream
International upstream operations earned $1.7 billion in second quarter 2021, compared with a loss of $4.0 billion a year ago. The increase in earnings was primarily due to the absence of second quarter 2020 special item charges and benefits including write-offs and impairments, severance charges, tax items and the gain on the Azerbaijan asset sale as well as higher current quarter crude oil realizations. Foreign currency effects had a favorable impact on earnings of $340 million between periods.

The average sales price for crude oil and natural gas liquids in second quarter 2021 was $62 per barrel, up from $21 a year earlier. The average sales price of natural gas was $4.92 per thousand cubic feet in the second quarter, up from $4.48 in last year’s second quarter.

Net oil-equivalent production of 1.99 million barrels per day in second quarter 2021 decreased slightly from second quarter 2020. Higher production of an additional 148,000 barrels per day following the Noble Energy acquisition and lower production curtailments were more than offset by unfavorable entitlement effects and operational impacts. The net liquids component of oil-equivalent production decreased 8 percent to 990,000 barrels per day in second quarter 2021, while net natural gas production of 5.99 billion cubic feet per day increased 8 percent, compared to last year's second quarter.

CAPITAL AND EXPLORATORY EXPENDITURES

Capital and exploratory expenditures in the first six months of 2021 were $5.3 billion, compared with $7.7 billion in 2020. The amounts included $1.5 billion in 2021 and $2.3 billion in 2020 for the company’s share of expenditures by affiliates, which did not require cash outlays by the company. Expenditures for upstream represented 84 percent of the company-wide total in 2021.

Chevron is one of the world’s leading integrated energy companies. We believe affordable, reliable and ever-cleaner energy is essential to achieving a more prosperous and sustainable world. Chevron produces crude oil and natural gas; manufactures transportation fuels, lubricants, petrochemicals and additives; and develops technologies that enhance our business and the industry. To advance a lower-carbon future, we are focused on cost efficiently lowering our carbon intensity, increasing renewables and offsets in support of our business, and investing in low-carbon technologies that enable commercial solutions.

KeyFacts Energy: Chevron US country profile