Chevron Corp. has announced a loss of $1.5 billion for 2Q16, compared to earnings of $571 million in 2Q15. Impairments and other non-cash charges totalling $2.8 billion – partially offset by gains on asset sales of $420 million – were included in the quarter. The company also added that foreign currency effects increased earnings in 2Q16 by $279 million, compared with a decrease of $251 million the previous year. Furthermore, sales and other operating revenues in 2Q16 were at $28 billion, compared to $37 billion in 2Q15.
The Chairman and CEO of the company, John Watson, said: “The second quarter results reflected lower oil prices and our ongoing adjustment to a lower oil price world.
“In our upstream business, we recorded impairment and other charges on certain assets where revenue from expected oil and gas production is expected to be insufficient to recover costs. Our downstream business continued to perform well.
“We continue to make progress towards our goal of getting cash balanced […] Our operating expenses and capital spending were reduced over $6 billion from the first six months of 2015.
“In addition, we’re bringing our major capital projects to completion […] We have restarted LNG production and cargo shipments at Gorgon and Angola LNG, and started up the third train at the Chuandongbei Project in China. Construction at our other key projects is progressing, and we expect additional start-ups later this year. As these projects continue to ramp up, they are expected to increase net cash generation in future quarters.”
Watson added: “We recently announced the final investment decision on the Future Growth and Wellhead Pressure Management Project at Tengiz in Kazakhstan.
“The project represents an excellent opportunity for the company. It builds on our strong track record at Tengiz and is expected to create future value for our shareholders.”
Edited from press release by David Rowlands
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