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Exxon Mobil beats analyst expectations, boosting production in Permian Basin

Exxon Mobil increasing crude processing capacity at Beaumont, Texas refinery by 20,000 b/d, secures more Permian Basin acreage

Exxon Mobil

Exxon Mobil

Exxon Mobil Corp. (XOM) on Friday reported third-quarter earnings of $4.24 billion. The Irving, Texas-based company said it had profit of $1.01 per share.

The results exceeded Wall Street expectations, but Exxon does not adjust its reported results based on one-time events such as asset sales. The average estimate of 10 analysts surveyed by Zacks Investment Research was for earnings of 89 cents per share.

The oil and natural gas company posted revenue of $67.34 billion in the period.

Exxon Mobil shares have dropped 11 per cent since the beginning of the year, while the Standard & Poor’s 500 index has climbed 1.5 per cent. The stock has fallen 13 per cent in the last 12 months.

Upstream earnings were $1.4 billion in the third quarter of 2015, down $5.1 billion from the third quarter of 2014. Lower liquids and gas realizations decreased earnings by $5.1 billion, while volume and mix effects, driven by new developments, increased earnings by $110 million. All other items decreased earnings by $70 million.

Exxon MobilOn an oil-equivalent basis, production increased 2.3 per cent from the third quarter of 2014. Liquids production totaled 2.3 million barrels per day, up 266,000 barrels per day, with project ramp-up and entitlement effects partly offset by field decline.

Exxon Mobil executed two agreements to obtain horizontal development rights in 48,000 acres adjoining its existing acreage position in the Midland Basin.

The acreage will provide rights to all intervals within the basin and be operated by Exxon Mobil’s subsidiary XTO Energy, Inc. Exxon Mobil has executed five agreements in the Midland Basin since January 2014, increasing the company’s position to over 135,000 net acres.

Exxon Mobil plans to increase crude processing capacity at the Beaumont, Texas, refinery by approximately 20,000 barrels per day, adding flexibility to process domestic light crude oils.

This capacity expansion further strengthens the competitiveness of the company’s strategic assets in North America and enhances U.S. energy security.

Natural gas production was 9.5 billion cubic feet per day, down 1.1 billion cubic feet per day from 2014 due to regulatory restrictions in the Netherlands and field decline, partly offset by project volumes.

Exxon Mobil

ExxonMobil’s Beaumont refinery.

U.S. Upstream earnings declined $1.7 billion from the third quarter of 2014 to a loss of $442 million in the third quarter of 2015. Non-U.S. Upstream earnings were $1.8 billion, down $3.4 billion from the prior year.

Downstream earnings were $2 billion, up $1 billion from the third quarter of 2014. Stronger margins increased earnings by $1.4 billion. Lower refining volumes due to higher maintenance-related activities decreased earnings by $280 million.

All other items, including maintenance-driven expenditures partly offset by favorable foreign exchange impacts, decreased earnings by $110 million. Petroleum product sales of 5.8 million barrels per day were 211,000 barrels per day lower than the prior year.

Earnings from the U.S. Downstream were $487 million, up $27 million from the third quarter of 2014. Non-U.S. Downstream earnings of $1.5 billion were $982 million higher than last year.

Chemical earnings of $1.2 billion were $27 million higher than the third quarter of 2014. Margins increased earnings by $210 million, benefiting from lower feedstock costs. Volume mix effects increased earnings by $30 million.

All other items, primarily unfavorable foreign exchange effects, decreased earnings by $210 million. Third quarter prime product sales of 6.1 million metric tons were 167,000 metric tons lower than the prior year’s third quarter.

Corporate and financing expenses were $378 million for the third quarter of 2015, down $192 million from the third quarter of 2014 driven by favorable tax and financing items.

During the third quarter of 2015, Exxon Mobil purchased 6.5 million shares of its common stock for the treasury to reduce the number of shares outstanding at a cost of $500 million. Share purchases to reduce shares outstanding are currently anticipated to equal $500 million in the fourth quarter of 2015.

Purchases may be made in both the open market and through negotiated transactions, and may be increased, decreased, or discontinued at any time without prior notice.

 

Posted in: Energy Financial

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