DALLAS--(BUSINESS WIRE)--Primoris Services Corporation (NASDAQ Global Select: PRIM) (“Primoris” or the “Company”), a leading provider of specialty contracting services in North America, announced today that it has closed its acquisition of PLH Group, Inc. (“PLH Group” or “PLH”) in an all-cash transaction valued at $470 million. The transaction directly aligns with Primoris’ strategic focus on higher-growth, higher-margin markets and expands its capabilities in the utility markets, including power delivery, communications, and gas utilities.

PLH Group is a utility-focused specialty services company with concentration in growing regions of the U.S. As a result of the acquisition, the majority of PLH operations will be incorporated into Primoris’ Utilities Segment, with the remaining operations going into the Energy/Renewables and Pipeline segments.

“The addition of PLH is an important step in enhancing both the size and scale of our operations in the Power Delivery and Gas Utilities markets. This acquisition will help us capture substantial growth tailwinds as the U.S. transitions to greater dependence on both traditional and renewable energy sources,” said Tom McCormick, Primoris’ President and Chief Executive Officer. “We welcome the PLH team to the Primoris family of companies as we work together to drive our company forward.”

ABOUT PRIMORIS

Primoris Services Corporation is a leading specialty contractor providing critical infrastructure services to the utility, energy/renewables and pipeline services markets throughout the United States and Canada. The Company supports a diversified base of blue-chip customers with engineering, procurement, construction and maintenance services. A focus on multi-year master service agreements and an expanded presence in higher-margin, higher-growth markets such as utility-scale solar facility installations, renewable fuels, power delivery systems and communications infrastructure have also increased the Company’s potential for long-term growth. Additional information on Primoris is available at www.primoriscorp.com.

FORWARD LOOKING STATEMENTS

This press release contains certain forward-looking statements, including the Company’s outlook, that reflect, when made, the Company’s expectations or beliefs concerning future events that involve risks and uncertainties, including with regard to the Company’s future performance. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “intends”, “may”, “plans”, “potential”, “predicts”, “projects”, “should”, “targets”, “will”, “would” or similar expressions. Forward-looking statements include information concerning the possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth opportunities, the effects of regulation and the economy, generally. Forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Actual results may differ materially as a result of a number of factors, including, among other things, customer timing, project duration, weather, and general economic conditions; changes in the mix of customers, projects, contracts and business; regional or national and/or general economic conditions and demand for the Company’s services; macroeconomic impacts arising from the long duration of the COVID-19 pandemic, including labor shortages and supply chain disruptions; price, volatility, and expectations of future prices of oil, natural gas, and natural gas liquids; variations and changes in the margins of projects performed during any particular quarter; increases in the costs to perform services caused by changing conditions; the termination, or expiration of existing agreements or contracts; the budgetary spending patterns of customers; inflation and other increases in construction costs that the Company may be unable to pass through to customers; cost or schedule overruns on fixed-price contracts; availability of qualified labor for specific projects; changes in bonding requirements and bonding availability for existing and new agreements; the need and availability of letters of credit; costs incurred to support growth, whether organic or through acquisitions; the timing and volume of work under contract; losses experienced in the Company’s operations; the results of the review of prior period accounting on certain projects and the impact of adjustments to accounting estimates; developments in governmental investigations and/or inquiries; intense competition in the industries in which the Company operates; failure to obtain favorable results in existing or future litigation or regulatory proceedings, dispute resolution proceedings or claims, including claims for additional costs; failure of partners, suppliers or subcontractors to perform their obligations; cyber-security breaches; failure to maintain safe worksites; risks or uncertainties associated with events outside of the Company’s control, including severe weather conditions, public health crises and pandemics (such as COVID-19), war or other armed conflict (including Russia’s invasion of Ukraine), political crises or other catastrophic events; client delays or defaults in making payments; the availability of credit and restrictions imposed by credit facilities; failure to implement strategic and operational initiatives; risks or uncertainties associated with acquisitions, dispositions and investments; possible information technology interruptions or inability to protect intellectual property; the Company’s failure, or the failure of the Company’s agents or partners, to comply with laws; the Company's ability to secure appropriate insurance; new or changing legal requirements, including those relating to environmental, health and safety matters; the loss of one or a few clients that account for a significant portion of the Company's revenues; asset impairments; and risks arising from the inability to successfully integrate acquired businesses. In addition to information included in this press release, additional information about these and other risks can be found in Part I, Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, and the Company’s other filings with the U.S. Securities and Exchange Commission (“SEC”). Such filings are available on the SEC’s website at www.sec.gov. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements. Primoris does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

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• Reported second-quarter earnings of $3.2 billion or $6.53 per share; adjusted earnings of $3.3 billion or $6.77 per share
• Generated $1.8 billion of operating cash flow; $3.6 billion excluding working capital
• Repaid $1.5 billion of debt
• Returned $533 million to shareholders through dividends and share repurchases
• Continued record-setting NGL fractionated volumes
• Strong refining operations including execution of planned turnarounds
• Received API pipeline safety award for second consecutive year
• Announced final investment decision on Rodeo Renewed project

HOUSTON--(BUSINESS WIRE)--Phillips 66 (NYSE: PSX), a diversified energy company, announces second-quarter 2022 earnings of $3.2 billion, compared with earnings of $582 million in the first quarter of 2022. Excluding special items of $118 million, the company had adjusted earnings of $3.3 billion in the second quarter, compared with first-quarter adjusted earnings of $595 million.

“Our earnings reflect the strong market environment during the second quarter driven by a tight global product supply and demand balance,” said Mark Lashier, President and CEO of Phillips 66. “We are focused on reliably providing critical energy products, including transportation fuels, to meet peak summer demand. We also advanced strategic capital projects to help meet the growing demand for renewable fuels and NGLs.

“During the second quarter, we paid down $1.5 billion of debt, increased our dividend and resumed share repurchases. Additionally, we are transforming our business to achieve sustained annual cost savings of at least $700 million to ensure we remain competitive in any market environment. We will continue to prioritize operating excellence and disciplined capital allocation.”

Midstream

Midstream second-quarter 2022 pre-tax income was $292 million, compared with $242 million in the first quarter of 2022.

Transportation second-quarter adjusted pre-tax income was $250 million, compared with adjusted pre-tax income of $278 million in the first quarter. The decrease was mainly due to lower equity earnings driven by reduced Bakken Pipeline crude volumes associated with winter storm impacts.

NGL and Other adjusted pre-tax income was $152 million in the second quarter, compared with adjusted pre-tax income of $91 million in the first quarter. The increase was attributable to improved margins and volumes at the Sweeny Hub and higher equity earnings from the Sand Hills Pipeline.

The company’s equity investment in DCP Midstream, LLC generated second-quarter adjusted pre-tax income of $130 million, a $99 million increase from the prior quarter. The increase was mainly driven by improved gathering and processing results and hedging impacts.

In the second quarter, the fair value of the company’s investment in NOVONIX, Ltd., decreased by $240 million compared with a $158 million decrease in the first quarter.

Chemicals

The Chemicals segment reflects Phillips 66’s equity investment in Chevron Phillips Chemical Company LLC (CPChem). Chemicals second-quarter 2022 pre-tax income was $273 million, compared with $396 million in the first quarter of 2022.

CPChem’s Olefins and Polyolefins (O&P) business contributed $216 million of adjusted pre-tax income in the second quarter, compared with $377 million in the first quarter. The $161 million decrease was primarily due to lower margins resulting from higher feedstock costs, as well as increased utility and turnaround costs. Global O&P utilization was 94% for the quarter.

CPChem’s Specialties, Aromatics and Styrenics (SA&S) business contributed second-quarter adjusted pre-tax income of $59 million, compared with $32 million in the first quarter. The $27 million increase was primarily due to higher margins and equity earnings.

The $11 million decrease in Other adjusted costs in the second quarter mainly reflects lower employee-related expenses and higher capitalized interest related to growth projects.

Refining

Refining second-quarter 2022 pre-tax income was $3.0 billion, compared with pre-tax income of $123 million in the first quarter of 2022. Refining results in the first quarter included $17 million of hurricane-related maintenance and repair costs. Refining results in the second quarter included $70 million of costs related to the finalization of RIN obligations for prior year compliance periods and $26 million of costs related to the conversion of the Alliance Refinery to a terminal.

Adjusted pre-tax income for Refining was $3.1 billion in the second quarter, compared with adjusted pre-tax income of $140 million in the first quarter. The improvement was primarily due to higher realized margins driven by market crack spreads. The composite global market crack increased to $46.72 per barrel, up from $21.93 per barrel in the first quarter. Realized margins were $28.31 per barrel in the second quarter, up from $10.55 per barrel in the first quarter.

Pre-tax turnaround costs for the second quarter were $223 million, compared with first-quarter costs of $102 million. Crude utilization rate was 90% and clean product yield was 83% in the second quarter.

Marketing and Specialties

Marketing and Specialties (M&S) second-quarter 2022 pre-tax income was $765 million, compared with $316 million in the first quarter of 2022.

Adjusted pre-tax income for Marketing and Other was $656 million in the second quarter, an increase of $453 million from the first quarter. The increase was mainly due to higher realized fuel margins including inventory impacts. Refined product exports in the second quarter were 153,000 barrels per day (BPD).

Specialties generated second-quarter adjusted pre-tax income of $109 million, in line with the prior quarter.

Corporate and Other

Corporate and Other second-quarter 2022 pre-tax costs were $260 million, compared with pre-tax costs of $249 million in the first quarter of 2022. Pre-tax costs in the second quarter included business transformation restructuring costs of $25 million.

Adjusted pre-tax loss was $235 million in second-quarter 2022. The decrease in the second quarter was mainly driven by lower administrative and net interest expenses.

Financial Position, Liquidity and Return of Capital

Phillips 66 generated $1.8 billion in cash from operations in the second quarter of 2022, including cash distributions from equity affiliates of $527 million. Excluding working capital impacts, operating cash flow was $3.6 billion. The working capital impact was primarily due to higher accounts receivable.

During the quarter, the company repaid $1.5 billion of debt and funded $467 million of dividends, $66 million of share repurchases and $376 million of capital expenditures and investments.

As of June 30, 2022, Phillips 66 had $7.8 billion of liquidity, reflecting $2.8 billion of cash and cash equivalents and approximately $5.0 billion of total committed capacity under the company’s revolving credit facility. Consolidated debt was $13.0 billion at June 30, 2022. The company’s consolidated debt-to-capital ratio was 35% and its net debt-to-capital ratio was 29%.

Strategic Update

Phillips 66 is continuing its business transformation that will enable sustainable cost reductions of at least $700 million annually across the enterprise. Phillips 66 will provide a business transformation and strategy update at its investor day in New York City on November 9.

In Midstream, Phillips 66 was awarded the American Petroleum Institute’s (API) large operator Distinguished Pipeline Safety Award for the second consecutive year. In addition, the company received the Platinum Safety Award in the large-company division from the International Liquid Terminals Association.

At the Sweeny Hub, Frac 4 startup is expected late in the third quarter of 2022, adding 150,000 BPD of capacity. The total project cost is expected to be approximately $525 million. Upon completion, total Sweeny Hub fractionation capacity will be 550,000 BPD. The fractionators are supported by long-term commitments.

In Chemicals, CPChem is pursuing a portfolio of high-return growth projects:

• Growing its normal alpha olefins business with a second world-scale unit to produce 1-hexene, a critical component in high-performance polyethylene. Construction is underway on the 586 million pounds per year unit located in Old Ocean, Texas. The project utilizes CPChem’s proprietary technology. Startup is expected in the second half of 2023.

• Expanding propylene splitting capacity by 1 billion pounds per year with a new unit located at its Cedar Bayou facility. Startup is expected in the second half of 2023.

• Increasing polyalphaolefins capacity production in Belgium by over 130 million pounds per year. Startup is expected in 2024.

• Continuing development of world-scale petrochemical facilities on the U.S. Gulf Coast and in Ras Laffan, Qatar, jointly with Qatar Energy. CPChem expects to make a final investment decision for its U.S. Gulf Coast project this year.

In Refining, Phillips 66 made a final investment decision to convert its San Francisco Refinery in Rodeo, California, into one of the world’s largest renewable fuels facilities. The Rodeo Renewed refinery conversion project is expected to begin commercial operations in the first quarter of 2024. Upon completion, the facility will have over 50,000 BPD (800 million gallons per year) of renewable fuel production capacity. The conversion will reduce emissions from the facility and produce lower carbon-intensity transportation fuels. The total project is anticipated to cost approximately $850 million.

In Marketing, subsidiaries of Phillips 66 and H2 Energy Europe recently formed JET H2 Energy Austria GmbH (JET H2 Energy), a 50-50 joint venture to develop approximately 250 retail hydrogen refueling stations across Germany, Austria and Denmark by 2026. JET H2 Energy’s network of hydrogen refueling stations will include existing Phillips 66’s JET^® branded retail stations as well as new locations on major transport routes.

The company published its 2022 Sustainability Report in June. The report includes a detailed analysis of the company’s climate-related risks and opportunities as well as performance data on various environmental, social and governance matters. To view Phillips 66’s 2022 Sustainability Report, go to phillips66.com/sustainability.

Investor Webcast

Later today, members of Phillips 66 executive management will host a webcast at noon EDT to discuss the company’s second-quarter performance and provide an update on strategic initiatives. To access the webcast and view related presentation materials, go to phillips66.com/investors and click on “Events & Presentations.” For detailed supplemental information, go to phillips66.com/supplemental.

About Phillips 66

Phillips 66 (NYSE: PSX) manufactures, transports and markets products that drive the global economy. The diversified energy company’s portfolio includes Midstream, Chemicals, Refining, and Marketing and Specialties businesses. Headquartered in Houston, Phillips 66 has employees around the globe who are committed to safely and reliably providing energy and improving lives while pursuing a lower-carbon future. For more information, visit phillips66.com or follow @Phillips66Co on LinkedIn or Twitter.

^{CAUTIONARY STATEMENT FOR THE PURPOSES OF THE “SAFE HARBOR” PROVISIONS
OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995}

^{This news release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Words and phrases such as “anticipated,” “estimated,” “expected,” “planned,” “scheduled,” “targeted,” “believes,” “continues,” “intends,” “will,” “would,” “objectives,” “goals,” “projects,” “efforts,” “strategies” and similar expressions are used to identify such forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements included in this news release are based on management’s expectations, estimates and projections as of the date they are made. These statements are not guarantees of future performance and you should not unduly rely on them as they involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include: the effects of any widespread public health crisis and its negative impact on commercial activity and demand for refined petroleum products; the inability to timely obtain or maintain permits necessary for capital projects; changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the renewable fuel standards program, low carbon fuel standards and tax credits for biofuels; fluctuations in NGL, crude oil, and natural gas prices, and petrochemical and refining margins; unexpected changes in costs for constructing, modifying or operating our facilities; unexpected difficulties in manufacturing, refining or transporting our products; the level and success of drilling and production volumes around our Midstream assets; risks and uncertainties with respect to the actions of actual or potential competitive suppliers and transporters of refined petroleum products, renewable fuels or specialty products; lack of, or disruptions in, adequate and reliable transportation for our NGL, crude oil, natural gas, and refined products; potential liability from litigation or for remedial actions, including removal and reclamation obligations under environmental regulations; failure to complete construction of capital projects on time and within budget; the inability to comply with governmental regulations or make capital expenditures to maintain compliance; limited access to capital or significantly higher cost of capital related to illiquidity or uncertainty in the domestic or international financial markets; potential disruption of our operations due to accidents, weather events, including as a result of climate change, terrorism or cyberattacks; general domestic and international economic and political developments including armed hostilities, expropriation of assets, and other political, economic or diplomatic developments, including those caused by public health issues and international monetary conditions and exchange controls; changes in governmental policies relating to NGL, crude oil, natural gas, refined petroleum products, or renewable fuels pricing, regulation or taxation, including exports; changes in estimates or projections used to assess fair value of intangible assets, goodwill and property and equipment and/or strategic decisions with respect to our asset portfolio that cause impairment charges; investments required, or reduced demand for products, as a result of environmental rules and regulations; changes in tax, environmental and other laws and regulations (including alternative energy mandates); political and societal concerns about climate change that could result in changes to our business or increase expenditures, including litigation-related expenses; the operation, financing and distribution decisions of equity affiliates we do not control; and other economic, business, competitive and/or regulatory factors affecting Phillips 66’s businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.}

^{Use of Non-GAAP Financial Information—This news release includes the terms “adjusted earnings (loss),” “adjusted earnings (loss) per share” and “adjusted pre-tax income (loss).” These are non-GAAP financial measures that are included to help facilitate comparisons of operating performance across periods and to help facilitate comparisons with other companies in our industry, by excluding items that do not reflect the core operating results of our businesses in the current period.}

^{References in the release to earnings (loss) or consolidated earnings (loss) refer to net income (loss) attributable to Phillips 66.}

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• Reported earnings of $11.6 billion; adjusted earnings of $11.4 billion
• Cash flow from operations of $13.8 billion; free cash flow of $10.6 billion
• Completed acquisition of Renewable Energy Group, Inc.

SAN RAMON, Calif.--(BUSINESS WIRE)--Chevron Corporation (NYSE: CVX) today reported earnings of $11.6 billion ($5.95 per share - diluted) for second quarter 2022, compared with $3.1 billion ($1.60 per share - diluted) in second quarter 2021. Included in the current quarter were charges associated with an early contract termination of $600 million, pension settlement costs of $11 million, and a gain on asset sales of $200 million. Foreign currency effects increased earnings by $668 million. Adjusted earnings of $11.4 billion ($5.82 per share - diluted) in second quarter 2022 compares to adjusted earnings of $3.3 billion ($1.71 per share - diluted) in second quarter 2021.

Sales and other operating revenues in second quarter 2022 were $65 billion, compared to $36 billion in the year-ago period.

Earnings Summary

“Second quarter financial performance improved as we delivered a return on capital employed of 26 percent,” said Mike Wirth, Chevron’s chairman and chief executive officer. The company also strengthened its balance sheet, lowering its debt ratio to under 15 percent, and increased the top end of its annual share repurchase guidance range to $15 billion.

“We more than doubled investment compared to last year to grow both traditional and new energy business lines,” Wirth added. “With Permian production more than 15 percent higher than a year ago and now as one of the leading renewable fuel producers in the United States, Chevron is increasing energy supplies to help meet the challenges facing global markets,” Wirth concluded.

This investment includes total capital and exploratory and acquisition-related expenditures as Chevron closed its acquisition of Renewable Energy Group, Inc. and completed the formation of a renewable fuels joint venture with Bunge North America, Inc. Also during the second quarter, the company sanctioned the Ballymore project in the deepwater U.S. Gulf of Mexico, which is expected to require a gross investment of approximately $1.6 billion. The field is planned to be produced through an existing facility with allocated capacity of 75,000 barrels of crude oil per day.

The company also advanced its carbon capture and storage (CCS) business this quarter by launching a CCS project aimed at reducing the carbon intensity of its upstream operations in California and forming an expanded joint venture to develop the Bayou Bend CCS hub in Texas, with the goal of it becoming one of the first offshore CCS projects in the United States.

Further, leveraging the company’s growing U.S. natural gas production and its global liquefied natural gas (LNG) value chain, Chevron signed agreements to export 4 million tonnes per year of LNG out of the U.S. Gulf Coast, commencing in 2026.

UPSTREAM

Worldwide net oil-equivalent production was 2.90 million barrels per day in second quarter 2022. International production decreased 13 percent primarily due to the end of concessions in Thailand and Indonesia, while U.S. production increased 3 percent compared to the same period a year ago mainly in the Permian Basin.

U.S. upstream operations earned $3.37 billion in second quarter 2022, compared with $1.45 billion a year earlier. The improvement was primarily due to higher realizations, partially offset by higher operating expenses largely due to an early contract termination.

The company’s average sales price per barrel of crude oil and natural gas liquids was $89 in second quarter 2022, up from $54 a year earlier. The average sales price of natural gas was $6.22 per thousand cubic feet in second quarter 2022, up from $2.16 in last year’s second quarter.

Net oil-equivalent production of 1.17 million barrels per day in second quarter 2022 was up 36,000 barrels per day from a year earlier. The increase was primarily due to net production increases in the Permian Basin. The net liquids component of oil-equivalent production in second quarter 2022 increased 4 percent to 888,000 barrels per day, and net natural gas production increased 2 percent to 1.71 billion cubic feet per day, compared to last year’s second quarter.

International upstream operations earned $5.19 billion in second quarter 2022, compared with $1.73 billion a year ago. The increase in earnings was primarily due to higher realizations and asset sale gains, partially offset by lower sales volumes. Foreign currency effects had a favorable impact on earnings of $525 million between periods.

The average sales price for crude oil and natural gas liquids in second quarter 2022 was $102 per barrel, up from $62 a year earlier. The average sales price of natural gas was $9.23 per thousand cubic feet in the second quarter, up from $4.92 in last year’s second quarter.

Net oil-equivalent production of 1.72 million barrels per day in second quarter 2022 was down 266,000 barrels per day from second quarter 2021. The decrease was primarily due to the absence of production following expiration of the Erawan concession in Thailand and Rokan concession in Indonesia, and unfavorable entitlement effects due to higher prices. The net liquids component of oil-equivalent production decreased 19 percent to 799,000 barrels per day in second quarter 2022, while net natural gas production decreased 7 percent to 5.55 billion cubic feet per day compared to last year’s second quarter.

DOWNSTREAM

U.S. downstream operations reported earnings of $2.44 billion in second quarter 2022, compared with earnings of $776 million a year earlier. The increase was mainly due to higher margins on refined product sales, partially offset by lower earnings from the 50 percent-owned Chevron Phillips Chemical Company and higher operating expenses.

Refinery crude oil input in second quarter 2022 decreased 8 percent to 881,000 barrels per day from the year-ago period, primarily due to planned turnarounds.

Refined product sales of 1.21 million barrels per day were up 4 percent from the year-ago period, mainly due to higher jet fuel demand as travel restrictions associated with the pandemic continue to ease.

International downstream operations reported earnings of $1.08 billion in second quarter 2022, compared with $63 million a year earlier. The increase was mainly due to higher margins on refined product sales and a $144 million favorable swing in foreign currency impacts between periods.

Refinery crude oil input of 634,000 barrels per day in second quarter 2022 increased 9 percent from the year-ago period as refinery runs increased due to higher demand.

Refined product sales of 1.34 million barrels per day in second quarter 2022 increased 4 percent from the year-ago period, mainly due to higher demand for jet fuel as restrictions from the pandemic continue to ease.

ALL OTHER

All Other consists of worldwide cash management and debt financing activities, corporate administrative functions, insurance operations, real estate activities and technology companies.

Net charges in second quarter 2022 were $459 million, compared to $935 million a year earlier. The decrease in net charges between periods was mainly due to lower employee benefit costs, pension expenses and interest expense, partially offset by an unfavorable swing in foreign currency effects.

CASH FLOW FROM OPERATIONS

Cash flow from operations in the first six months of 2022 was $21.8 billion, compared with $11.2 billion in 2021. Excluding working capital effects, cash flow from operations in the first six months of 2022 was $22.2 billion, compared with $12.2 billion in 2021.

TOTAL CAPITAL AND EXPLORATORY EXPENDITURES

Capital and exploratory expenditures, including equity affiliates (Total C&E) in the first six months of 2022 were $6.7 billion, compared with $5.3 billion in 2021. The amounts included $1.5 billion in 2022 and $1.5 billion in 2021 for the company’s share of expenditures by affiliates, which did not require cash outlays by the company. Expenditures for upstream represented 79 percent of the company-wide total in 2022. Total C&E for 2022 includes $700 million of inorganic spend largely associated with the formation of the Bunge joint venture. The acquisition of Renewable Energy Group, Inc. is not included in the company’s Total C&E.

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. We are focused on lowering the carbon intensity in our operations and growing lower carbon businesses along with our traditional business lines. More information about Chevron is available at www.chevron.com.

NOTICE

Chevron’s discussion of second quarter 2022 earnings with security analysts will take place on Friday, July 29, 2022, at 8:00 a.m. PT. A webcast of the meeting will be available in a listen-only mode to individual investors, media, and other interested parties on Chevron’s website at www.chevron.com under the “Investors” section. Prepared remarks for today’s call, additional financial and operating information and other complementary materials will be available prior to the call at approximately 3:30 a.m. PT and located under “Events and Presentations” in the “Investors” section on the Chevron website.

As used in this news release, the term “Chevron” and such terms as “the company,” “the corporation,” “our,” “we,” “us” and “its” may refer to Chevron Corporation, one or more of its consolidated subsidiaries, or to all of them taken as a whole. All of these terms are used for convenience only and are not intended as a precise description of any of the separate companies, each of which manages its own affairs.

Please visit Chevron’s website and Investor Relations page at www.chevron.com and www.chevron.com/investors, LinkedIn: www.linkedin.com/company/chevron, Twitter: @Chevron, Facebook: www.facebook.com/chevron, and Instagram: www.instagram.com/chevron, where Chevron often discloses important information about the company, its business, and its results of operations.

Key Performance Indicator - Capital and exploratory expenditures, including equity affiliates (Total C&E), is a key performance indicator for the company and provides a comprehensive view of its share of investment levels. This metric includes additions to fixed asset or investment accounts, or to exploration expense, for consolidated companies and our share of these expenditures by equity affiliates. Management uses this metric to manage allocation of capital across its entire portfolio, funding requirements and ultimately shareholder distributions. The calculation of Total C&E is shown in Attachment 2.

Non-GAAP Financial Measures - This news release includes adjusted earnings/(loss), which reflect earnings or losses excluding significant non-operational items including impairment charges, write-offs, severance costs, gains on asset sales, unusual tax items, effects of pension settlements and curtailments, foreign currency effects and other special items. We believe it is useful for investors to consider this measure in comparing the underlying performance of our business across periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income (loss) as prepared in accordance with U.S. GAAP. A reconciliation to net income (loss) attributable to Chevron Corporation is shown in Attachment 5.

This news release also includes cash flow from operations excluding working capital, free cash flow and free cash flow excluding working capital. Cash flow from operations excluding working capital is defined as net cash provided by operating activities less net changes in operating working capital, and represents cash generated by operating activities excluding the timing impacts of working capital. Free cash flow is defined as net cash provided by operating activities less cash capital expenditures and generally represents the cash available to creditors and investors after investing in the business. Free cash flow excluding working capital is defined as net cash provided by operating activities excluding working capital less cash capital expenditures and generally represents the cash available to creditors and investors after investing in the business excluding the timing impacts of working capital. The company believes these measures are useful to monitor the financial health of the company and its performance over time. A reconciliation of cash flow from operations excluding working capital, free cash flow and free cash flow excluding working capital are shown in Attachment 3.

This news release also includes net debt ratio. Net debt ratio is defined as total debt less cash and cash equivalents and marketable securities as a percentage of total debt less cash and cash equivalents and marketable securities, plus Chevron Corporation stockholders’ equity, which indicates the company’s leverage, net of its cash balances. The company believes this measure is useful to monitor the strength of the company’s balance sheet. A reconciliation of net debt ratio is shown in Attachment 2.

CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This news release contains forward-looking statements relating to Chevron’s operations and energy transition plans that are based on management’s current expectations, estimates and projections about the petroleum, chemicals and other energy-related industries. Words or phrases such as “anticipates,” “expects,” “intends,” “plans,” “targets,” “advances,” “commits,” “drives,” “aims,” “forecasts,” “projects,” “believes,” “approaches,” “seeks,” “schedules,” “estimates,” “positions,” “pursues,” “may,” “can,” “could,” “should,” “will,” “budgets,” “outlook,” “trends,” “guidance,” “focus,” “on track,” “goals,” “objectives,” “strategies,” “opportunities,” “poised,” “potential,” “ambitions,” “aspires” and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, many of which are beyond the company’s control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this news release. Unless legally required, Chevron undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: changing crude oil and natural gas prices and demand for the company’s products, and production curtailments due to market conditions; crude oil production quotas or other actions that might be imposed by the Organization of Petroleum Exporting Countries and other producing countries; technological advancements; changes to government policies in the countries in which the company operates; public health crises, such as pandemics (including coronavirus (COVID-19)) and epidemics, and any related government policies and actions; disruptions in the company’s global supply chain, including supply chain constraints and escalation of the cost of goods and services; changing economic, regulatory and political environments in the various countries in which the company operates; general domestic and international economic, market and political conditions, including the military conflict between Russia and Ukraine and the global response to such conflict; changing refining, marketing and chemicals margins; actions of competitors or regulators; timing of exploration expenses; timing of crude oil liftings; the competitiveness of alternate-energy sources or product substitutes; development of large carbon capture and offset markets; the results of operations and financial condition of the company’s suppliers, vendors, partners and equity affiliates, particularly during the COVID-19 pandemic; the inability or failure of the company’s joint-venture partners to fund their share of operations and development activities; the potential failure to achieve expected net production from existing and future crude oil and natural gas development projects; potential delays in the development, construction or start-up of planned projects; the potential disruption or interruption of the company’s operations due to war, accidents, political events, civil unrest, severe weather, cyber threats, terrorist acts, or other natural or human causes beyond the company’s control; the potential liability for remedial actions or assessments under existing or future environmental regulations and litigation; significant operational, investment or product changes undertaken or required by existing or future environmental statutes and regulations, including international agreements and national or regional legislation and regulatory measures to limit or reduce greenhouse gas emissions; the potential liability resulting from pending or future litigation; the company’s future acquisitions or dispositions of assets or shares or the delay or failure of such transactions to close based on required closing conditions; the potential for gains and losses from asset dispositions or impairments; government mandated sales, divestitures, recapitalizations, taxes and tax audits, tariffs, sanctions, changes in fiscal terms or restrictions on scope of company operations; foreign currency movements compared with the U.S. dollar; material reductions in corporate liquidity and access to debt markets; the receipt of required Board authorizations to implement capital allocation strategies, including future stock repurchase programs and dividend payments; the effects of changed accounting rules under generally accepted accounting principles promulgated by rule-setting bodies; the company’s ability to identify and mitigate the risks and hazards inherent in operating in the global energy industry; and the factors set forth under the heading “Risk Factors” on pages 20 through 25 of the company's 2021 Annual Report on Form 10-K and in subsequent filings with the U.S. Securities and Exchange Commission. Other unpredictable or unknown factors not discussed in this news release could also have material adverse effects on forward-looking statements.

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• Quarterly net income of $2,409 million and cash flow from operating activities of $2,682 million
• Upstream production of 413,000 gross oil equivalent barrels per day, highest second quarter in over 30 years
• Sustained strong Downstream operating performance with quarterly refinery capacity utilization of 96%, fourth consecutive quarter above 90%
• Returned over $2.7 billion to shareholders in the quarter through dividends and successful completion of the company’s $2.5 billion substantial issuer bid program
• Renewed annual normal course issuer bid to purchase up to an additional 5% of outstanding shares, with plans to accelerate completion of the program by the end of October 2022
• Declared third quarter dividend of 34 cents per share
• Announced the proposed sale of interests in XTO Energy Canada for a total cash consideration of $1.9 billion ($940 million Imperial’s share), further focusing the company’s Upstream portfolio on long-life, low-decline oil sands assets
• Released annual Advancing Climate Solutions report, outlining the company’s progress and ongoing commitment to lowering greenhouse gas emissions

Imperial reported estimated net income in the second quarter of $2,409 million, up from $1,173 million in the first quarter of 2022, driven by continued strong market conditions and improved operating performance. Cash flow from operating activities was $2,682 million up from $1,914 million in the first quarter of 2022.

“Our second quarter results are underpinned by an ongoing focus on safe and reliable operations, allowing us to capture significant value from our fully integrated assets amid continued commodity price strength, while also ensuring a stable supply of energy products to support growing demand,” said Brad Corson, chairman, president and chief executive officer.

Upstream production in the second quarter averaged 413,000 gross oil-equivalent barrels per day, the highest second quarter production in over 30 years. Kearl quarterly total gross production averaged 224,000 barrels per day, reflecting a full recovery in operating performance from the impacts of extreme cold weather experienced in the first quarter as well as the completion of its annual planned turnaround. Cold Lake quarterly production averaged 144,000 gross barrels per day, continuing to deliver strong operating performance while also completing a planned turnaround.

Following the impacts of extreme cold weather on Kearl operations in the first quarter of 2022 and the completion of its annual turnaround in the second quarter, Kearl production is expected to exceed 280,000 total gross barrels per day over the second half of the year. Consistent with this, Imperial is updating its annual full-year production guidance at Kearl to be around 245,000 total gross barrels per day.

“I am very pleased to see Kearl’s production performance recover to normal levels in the second quarter with the extreme cold weather related impacts now firmly behind us,” said Corson. “As I look ahead, Kearl’s accelerated journey to grow annual production to 280,000 total gross barrels per day remains on track and will create significant value for our shareholders.”

In the Downstream, quarterly refining throughput averaged 412,000 barrels per day with capacity utilization of 96%, the fourth consecutive quarter above 90%, as the company focuses on maximizing production to meet increased Canadian demand. Petroleum product sales in the quarter increased to an average of 480,000 barrels per day with Canadian fuel demand nearing pre-pandemic levels.

The company distributed over $2.7 billion to shareholders in the quarter through dividend payments and the successful completion of the company’s substantial issuer bid. In June, Imperial announced the renewal of its annual normal course issuer bid (NCIB) program, allowing the repurchase of up to five percent of its outstanding shares over a 12-month period ending on June 28, 2023. Imperial plans to accelerate its share purchases under the NCIB program and anticipates repurchasing all remaining allowable shares by the end of October 2022. The company also declared a third quarter dividend of 34 cents per share.

“In the first half of this year, Imperial has generated significant cash flow that has enabled record distributions to our shareholders and also increased the royalty and tax payments we make to federal and provincial governments that support the communities in which we operate,” said Corson. “The steps we have taken to further focus our portfolio, reduce costs and efficiently grow production position us to continue returning substantial cash to shareholders going forward.”

In June, Imperial announced together with ExxonMobil Canada that it had entered into an agreement with Whitecap Resources Inc. for the sale of XTO Energy Canada, which is jointly owned by Imperial and ExxonMobil Canada, for a total cash consideration of $1.9 billion ($940 million Imperial’s share). The sale is expected to close before the end of the third quarter 2022, subject to regulatory approvals. The divestment of XTO Energy Canada further delivers on Imperial’s strategy to maximize shareholder value by focusing the company’s Upstream resources on long-life, low-decline oil-sands assets.

During the quarter, Imperial released its annual Advancing Climate Solutions report outlining the company’s progress and ongoing commitment to lowering greenhouse gas emissions. Imperial is committed to providing energy solutions in a way that helps protect people, the environment and the communities where it operates, including mitigating the risks of climate change.

“Imperial is aggressively pursuing attractive opportunities that reduce emissions, increase production and support increased profitability,” said Corson. “We continue to progress a broad range of technology initiatives, including through our support of the Pathways Alliance and its application for carbon capture storage space, our recently announced plans for a lithium-extraction pilot in Alberta with potential use in battery-grade products and a hydrogen production feasibility study in Nanticoke that could help reduce the region’s greenhouse gas emissions.”

Second quarter highlights

• Net income of $2,409 million or $3.63 per share on a diluted basis, up from $366 million or $0.50 per share in the second quarter of 2021.
• Cash flows from operating activities of $2,682 million, up from $852 million in the same period of 2021. Cash flows from operating activities excluding working capital¹ of $2,783 million, up from $893 million in the same period of 2021.
• Capital and exploration expenditures totalled $314 million, up from $259 million in the second quarter of 2021.
• The company returned $2,728 million to shareholders in the second quarter of 2022, including $2,500 million from the company’s substantial issuer bid program completed in June and $228 million in dividends paid.
• Renewed share repurchase program, enabling the purchase of up to five percent of common shares outstanding, a maximum of 31,833,809 shares, during the 12-month period ending June 28, 2023. Consistent with the company’s commitment to returning surplus cash to shareholders, Imperial plans to accelerate its share purchases under the NCIB program and anticipates repurchasing all remaining allowable shares by the end of October 2022. Purchase plans may be modified at any time without prior notice.
• Production averaged 413,000 gross oil-equivalent barrels per day, highest second quarter in over 30 years, up from 401,000 barrels per day in the same period of 2021.
• Total gross bitumen production at Kearl averaged 224,000 barrels per day (159,000 barrels Imperial's share), compared to 255,000 barrels per day (181,000 barrels Imperial's share) in the second quarter of 2021, primarily driven by additional downtime. Following the impacts of extreme cold weather on Kearl operations in the first quarter of 2022 and the completion of its annual turnaround in the second quarter, Kearl production is expected to exceed 280,000 total gross barrels per day over the second half of the year. Consistent with this, Imperial is updating its annual full-year production guidance at Kearl to be around 245,000 total gross barrels per day.
• Gross bitumen production at Cold Lake averaged 144,000 barrels per day, up from 142,000 barrels per day in the second quarter of 2021, continuing to outperform the company’s annual production guidance of 135,000 to 140,000 gross barrels per day.
• The company's share of gross production from Syncrude averaged 81,000 barrels per day, up from 47,000 barrels per day in the second quarter of 2021, primarily driven by the timing of planned turnaround activities.
• Refinery throughput averaged 412,000 barrels per day, up from 332,000 barrels per day in the second quarter of 2021. Capacity utilization reached 96 percent, up from 78 percent in the second quarter of 2021, as the company continues to maximize production to meet increased Canadian demand. Second quarter utilization represents the fourth consecutive quarter above 90%.
• Petroleum product sales were 480,000 barrels per day, up from 429,000 barrels per day in the second quarter of 2021. Increased sales were driven by rising demand following further easing of Canadian pandemic restrictions.
• Chemical net income of $53 million in the quarter, compared to $109 million in the second quarter of 2021. Lower income was primarily driven by lower polyethylene margins.
• Announced, together with ExxonMobil Canada, the proposed sale of XTO Energy Canada to Whitecap Resources for total cash consideration of $1.9 billion ($940 million Imperial’s share). The sale is expected to close before the end of the third quarter 2022, subject to regulatory approvals. The divestment of XTO Energy Canada further delivers on Imperial’s strategy to maximize shareholder value by focusing Upstream resources on long-life, low-decline oil-sands assets.
• Released annual Advancing Climate Solutions report outlining the company’s progress and ongoing commitment to lowering GHG emissions. Imperial is committed to providing energy solutions in a way that helps protect people, the environment and the communities where it operates, including mitigating the risks of climate change.
• Announced strategic collaboration with E3 Lithium to advance a lithium extraction pilot in Alberta. The project will draw lithium from under Imperial’s historic Leduc oil field using E3 Lithium’s proprietary technology with potential for commercial development of battery-grade products. As part of the agreement, Imperial may provide technical and development support in areas such as water and reservoir management.
• Signed agreement with Atura Power to study the potential for hydrogen production in Nanticoke, Ontario. The study will focus on the commercial and technical aspects of developing a regional hydrogen facility that could help reduce greenhouse gas emissions in the area’s industrial sector in support of Canada’s net-zero ambitions.

Current business environment
During the COVID-19 pandemic, industry investment to maintain and increase production capacity was restrained to preserve capital, resulting in underinvestment and supply tightness as demand for petroleum and petrochemical products recovered. Across late 2021 and the first half of 2022, this dynamic, along with supply chain constraints and a continuation of demand recovery, led to a steady increase in oil and natural gas prices and refining margins. In the first half of 2022, tightness in the oil and natural gas markets was further exacerbated by Russia’s invasion of Ukraine and subsequent sanctions imposed upon business and other activities in Russia. The price of crude oil and certain regional natural gas indicators increased to levels not seen for several years. By the end of the second quarter, high prices had led to a tempering of demand for some products. Commodity and product prices are expected to remain volatile given the current global economic and geopolitical uncertainty affecting supply and demand.

Operating results

Upstream

Price – Higher realizations were generally in line with increases in marker prices, driven primarily by increased demand and supply chain constraints. Average bitumen realizations increased by $55.01 per barrel generally in line with WCS, and synthetic crude oil realizations increased by $63.87 per barrel generally in line with WTI.

Volumes – Higher volumes primarily driven by the timing of turnaround activities at Syncrude, partially offset by downtime at Kearl.

Royalty – Higher royalties primarily driven by improved commodity prices.

Other – Includes higher operating expenses of about $180 million, primarily higher energy prices, partially offset by favourable foreign exchange impacts of about $60 million.

Downstream

Margins – Higher margins primarily reflect improved market conditions.

Other – Includes lower turnaround impacts of about $130 million, reflecting the absence of turnaround activities at Strathcona refinery, partially offset by higher operating expenses of about $70 million, primarily higher energy costs.

Improved refinery throughput in the second quarter of 2022 was primarily driven by reduced turnaround activity and increased demand.

Improved petroleum product sales in the second quarter of 2022 were mainly due to increased demand.

Chemicals

Corporate and other

Liquidity and capital resources

Cash flow generated from operating activities primarily reflects higher Upstream realizations and improved Downstream margins.

Cash flow used in investing activities primarily reflects higher additions to property, plant and equipment.

Cash flow used in financing activities primarily reflects:

On May 6, 2022, the company commenced a substantial issuer bid pursuant to which it offered to purchase for cancellation up to $2.5 billion of its common shares through a modified Dutch auction and proportionate tender offer. The substantial issuer bid was completed on June 15, 2022, with the company taking up and paying for 32,467,532 common shares at a price of $77.00 per share, for an aggregate purchase of $2.5 billion and 4.9 percent of Imperial’s issued and outstanding shares as the close of business on May 2, 2022. This included 22,597,379 shares purchased from Exxon Mobil Corporation by way of a proportionate tender to maintain its ownership percentage at approximately 69.6 percent.

On June 27, 2022, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid and will continue its existing share purchase program. The program enables the company to purchase up to a maximum of 31,833,809 common shares during the period June 29, 2022 to June 28, 2023. This maximum includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent. The program will end should the company purchase the maximum allowable number of shares, or on June 28, 2023. Imperial plans to accelerate its share purchases under the normal course issuer bid program, and anticipates repurchasing all remaining allowable shares by the end of October 2022. Purchase plans may be modified at any time without prior notice.

Six months 2022 vs. six months 2021

Upstream

Price – Higher realizations were generally in line with increases in marker prices, driven primarily by increased demand and supply chain constraints. Average bitumen realizations increased by $49.08 per barrel generally in line with WCS, and synthetic crude oil realizations increased by $58.99 per barrel generally in line with WTI.

Volumes – Lower volumes primarily driven by downtime at Kearl, partially offset by the timing of turnaround activities at Syncrude.

Royalty – Higher royalties primarily driven by improved commodity prices.

Other – Includes higher operating expenses of about $220 million, primarily higher energy prices, partially offset by favourable foreign exchange impacts of about $60 million.

Downstream

Margins – Higher margins primarily reflect improved market conditions.

Other – Includes lower turnaround impacts of about $130 million, reflecting the absence of turnaround activities at Strathcona refinery, partially offset by higher operating expenses of about $90 million, primarily higher energy costs.

Improved refinery throughput in 2022 was primarily driven by reduced turnaround activity and increased demand.

Improved petroleum product sales in 2022 primarily reflects increased demand.

Chemicals

Corporate and other

Liquidity and capital resources

Cash flow generated from operating activities primarily reflects higher Upstream realizations, improved Downstream margins and favourable working capital impacts.

Cash flow used in investing activities primarily reflects higher additions to property, plant and equipment.

Cash flow used in financing activities primarily reflects:

Key financial and operating data follow.

Forward-looking statements

Statements of future events or conditions in this report, including projections, targets, expectations, estimates, and business plans are forward-looking statements. Forward-looking statements can be identified by words such as believe, anticipate, intend, propose, plan, goal, seek, project, predict, target, estimate, expect, strategy, outlook, schedule, future, continue, likely, may, should, will and similar references to future periods.

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• Increased Permian oil and gas production by approximately 130,000 oil-equivalent barrels per day and refining throughput by 180,000 barrels per day versus first half of 2021 to meet recovering product demand.

• Generated earnings of $17.9 billion and cash flow from operating activities of $20 billion in second-quarter 2022 as a result of increased production, higher realizations and margins, and aggressive cost control.

• Capital investments totaled $9.5 billion for first half of 2022; on track with full-year guidance.

• New lower-emission initiatives included four large-scale carbon capture and storage opportunities.

IRVING, Texas--(BUSINESS WIRE)--Exxon Mobil Corporation (NYSE:XOM):

Exxon Mobil Corporation today announced estimated second-quarter 2022 earnings of $17.9 billion, or $4.21 per share assuming dilution. Second-quarter results included a favorable identified item of nearly $300 million associated with the sale of the Barnett Shale Upstream assets. Capital and exploration expenditures were $4.6 billion in the second quarter and $9.5 billion for the first half of 2022.

“Earnings and cash flow benefited from increased production, higher realizations, and tight cost control,” said Darren Woods, chairman and chief executive officer. “Strong second-quarter results reflect our focus on the fundamentals and the investments we put in motion several years ago and sustained through the depths of the pandemic.”

“Key to our success is continued investment in our advantaged portfolio, including Guyana, the Permian, global LNG, and in our high-value performance products, along with efforts to reduce structural costs and improve efficiency. We're also helping meet increased demand by expanding our refining capacity by about 250,000 barrels per day in the first quarter of 2023 - representing the industry's largest single capacity addition in the U.S. since 2012. At the same time, we’re supporting the transition to a lower-emission future, growing our portfolio of opportunities in carbon capture and storage, biofuels, and hydrogen.”

Financial Highlights

• Second-quarter earnings of $17.9 billion compared with $5.5 billion in the first quarter of 2022. Excluding identified items, earnings of $17.6 billion increased $8.7 billion from the prior quarter, driven by a tight supply/demand balance for oil, natural gas, and refined products, which have increased both natural gas realizations and refining margins well above the 10-year range.

• Cash increased by $7.8 billion in the second quarter, as strong cash flow from operating activities more than covered capital investments and shareholder distributions. Free cash flow in the quarter totaled $16.9 billion. Shareholder distributions were $7.6 billion for the quarter, including $3.7 billion of dividends.

• Net-debt-to-capital ratio improved to 13% reflecting a period-end cash balance of $18.9 billion. The debt-to-capital ratio was 20%, at the low-end of the company's target range.

• Effective April 1, to improve the effectiveness of operations and to better serve customers, the Corporation formed ExxonMobil Product Solutions, combining world-scale Downstream and Chemical businesses. The company also centralized Technology & Engineering and Operations & Sustainability groups to further capture the benefits of technology, scale, and integration. The company has changed its segment reporting to reflect the new structure. 

Leading the Drive to Net Zero

Carbon Capture and Storage

• ExxonMobil signed a memorandum of understanding to explore the development of a carbon capture and storage project at the Dayawan Industrial Park in Guangdong Province, China. The envisioned project has the potential to capture up to 10 million metric tons of CO2 per year, and could become one of the first large petrochemical complexes to remove CO2 emissions.

• ExxonMobil, Neptune Energy, Rosewood, and EBN signed an agreement to advance the L10 carbon capture and storage project in the Dutch North Sea. This stage of the project has the potential to store four to five million metric tons of CO2 annually for industrial customers, and represents the first stage in the potential development of the greater L10 area as a large-volume CO2 storage reservoir.

• ExxonMobil announced the start of early front-end engineering design studies for a South East Australia carbon capture and storage hub in Gippsland, Victoria. The project would initially use existing infrastructure to store up to two million metric tons of CO2 per year from multiple local industries in the depleted Bream field off the coast of Gippsland. Operations could begin as early as 2025.

• Earlier in the quarter, ExxonMobil and Pertamina, the state-owned energy company for Indonesia, signed a joint study agreement to assess the potential for large-scale implementation of lower-emissions technologies, including carbon capture and storage and hydrogen production. The agreement builds on efforts to advance carbon capture and storage in Indonesia that began with a memorandum of understanding signed at COP26.

Biofuels and Hydrogen

• In early July, ExxonMobil successfully delivered the first cargo of certified sustainable aviation fuel (SAF) to Singapore Changi Airport as part of a one-year pilot program launched by the Civil Aviation Authority of Singapore, Singapore Airlines, and Temasek. In addition, ExxonMobil delivered the first cargo of SAF via proprietary pipeline to Virgin Atlantic at London Heathrow Airport. These programs represent part of a global plan to provide 200,000 barrels per day of lower-emission fuels by 2030.

• ExxonMobil's majority-owned affiliate, Imperial Oil Ltd., is progressing plans to produce renewable diesel at a new complex at its Strathcona refinery in Edmonton, Canada. When construction is complete, the refinery is expected to produce approximately 20,000 barrels per day of renewable diesel, which could reduce emissions in the Canadian transportation sector by about three million metric tons per year. The complex will use locally grown plant-based feedstock and hydrogen with carbon capture and storage as part of the manufacturing process.

• ExxonMobil is advancing the previously announced large-scale blue hydrogen plant in Baytown, Texas. The facility will have the capacity to produce up to one billion cubic feet of blue hydrogen per day and store approximately 10 million metric tons of CO2 per year, more than doubling ExxonMobil's current capacity.

• In June, ExxonMobil, Grieg Edge, North Ammonia, and GreenH signed a memorandum of understanding to study potential production and distribution of green hydrogen and ammonia for lower-emission marine fuels at ExxonMobil’s Slagen terminal in Norway. The production of up to 20,000 metric tons of green hydrogen and distribution of up to 100,000 metric tons of green ammonia per year would be driven by hydroelectric power.

• Upstream earnings in the second quarter of 2022 were $11.4 billion compared to $4.5 billion in the first quarter. Excluding identified items, earnings were $11.1 billion, an increase of $3.3 billion from the previous quarter. Crude realizations improved 15% and gas realizations increased 23% compared to the first quarter driven by tight supply. Higher production from growth projects and recovery from first quarter weather-related downtime in Canada were partly offset by price entitlement effects and increased seasonal scheduled maintenance.

• Oil-equivalent production in the second quarter was 3.7 million barrels per day. Excluding entitlement effects, divestments, and government mandates, including the impact of curtailed production in Russia, oil-equivalent production increased 4% versus the first quarter. Liquids volumes increased nearly 35,000 barrels per day and natural gas volumes grew by more than 150 million cubic feet per day.

• Earnings excluding identified items increased $7.9 billion relative to the second quarter of 2021. This improvement was primarily the result of a 71% increase in crude realizations and a 186% increase in natural gas realizations. Oil-equivalent production increased 5%, excluding entitlement effects, divestments, and government mandates. Liquids volumes rose nearly 100,000 barrels per day, while natural gas volumes increased by almost 315 million cubic feet per day.

• Year-to-date earnings excluding identified items were $18.8 billion, an increase of $13.1 billion versus the first half of 2021 on higher crude and natural gas realizations.

• The Permian continued to improve efficiency and grow volumes, with average production during the quarter of more than 550,000 oil-equivalent barrels per day. The company is expecting to achieve a 25% production increase this year versus full-year 2021 and to eliminate routine flaring in the Permian by year end.

• Offshore Guyana production capacity increased to more than 340,000 oil-equivalent barrels per day with Liza Phase 2 production start-up earlier this year and Liza Phase 1 producing above design capacity. In addition, two new discoveries were announced. The company also reached an agreement to supply the country of Guyana with natural gas to significantly reduce domestic energy costs and provide opportunities for industrial growth.

• ExxonMobil and QatarEnergy signed an agreement to further develop Qatar's North Field East project, which will expand Qatar's annual LNG capacity with over 30 million tons per year by 2026.

• The Coral South Floating LNG project offshore Mozambique initiated flow of gas in June, and is on track to deliver the first LNG cargo in the second half of 2022.

• Asset sales and divestments resulting in more than $3 billion of proceeds were announced during the second quarter. The sale of the company's operated and non-operated Barnett Shale gas assets in Texas was completed in June, contributing nearly $300 million in earnings and more than $600 million in cash during the quarter. The other announced divestments, including XTO Energy Canada and the Romania Upstream affiliate, are anticipated to close later this year, subject to regulatory approvals.

• Energy Products second-quarter 2022 earnings totaled $5.3 billion compared to a loss of $0.2 billion in the first quarter. Strong refinery utilization in the quarter captured improved industry margins. Higher sales volumes were more than offset by unfavorable mix impacts and higher planned seasonal expenses. In addition, earnings benefited from more moderate commodity price increases which resulted in favorable unsettled derivative mark-to-market impacts, and the expected reversal of price/timing impacts from the first quarter.

• Earnings increased $6.1 billion compared to the second quarter of 2021 due to stronger industry refining margins, favorable derivative mark-to-market effects, and increased volumes on lower scheduled maintenance.

• Year-to-date earnings of $5.1 billion compared to a loss of $1.8 billion in the first half of 2021, driven by stronger industry refining margins and higher volumes.

• Refining throughput in the first half of 2022 was up 180,000 barrels per day versus the first six months of 2021 to meet recovering product demand.

• The Beaumont Refinery expansion remains on pace to add an incremental 250,000 barrels per day of refining capacity in the first quarter of 2023, which would increase the company's U.S. Gulf Coast refining capacity by about 17%.

• Chemical Products second-quarter 2022 earnings were $1.1 billion compared to $1.4 billion in the first quarter. Reliable operations and cost discipline drove strong earnings despite margins being impacted by higher ethane feed costs in North America, a stronger U.S. dollar, higher planned seasonal expenses, and lower volumes driven by China lockdown demand impacts and logistics constraints.

• Earnings were $1.1 billion lower compared to second-quarter 2021 on reduced industry margins and unfavorable foreign exchange effects.

• Year-to-date earnings totaled $2.5 billion compared to $3.6 billion in the first six months of 2021. Lower margins due to rising North America feed costs, increased project and planned maintenance expenses, and unfavorable foreign exchange effects were partially offset by higher volumes.

• Specialty Products earnings were $0.4 billion in the second quarter of 2022 compared with $0.5 billion in the first quarter. Earnings remained at historically strong levels on improved basestock margins, with pricing offsetting rising feed and energy costs, which were offset by higher planned seasonal expenses and unfavorable foreign exchange impacts.

• Compared to the same quarter last year, earnings declined $0.3 billion on lower basestock industry margins and decreased volumes driven by higher scheduled maintenance.

• Year-to-date earnings of $0.9 billion decreased from $1.3 billion in the first half of 2021, primarily due to lower basestock industry margins driven by higher feed costs.

• Corporate and Financing reported net charges of $0.3 billion in the second quarter of 2022 compared with $0.7 billion in the first quarter. Excluding a first-quarter identified items charge of $0.1 billion related to Russia, net charges were down $0.3 billion as a result of favorable one-time tax impacts.

• Net charges of $0.3 billion in the second quarter of 2022 compared with $0.6 billion in the second quarter of 2021.

   

ExxonMobil will discuss financial and operating results and other matters during a webcast at 8:30 a.m. Central Time on July 29, 2022. To listen to the event or access an archived replay, please visit www.exxonmobil.com.

Cautionary Statement

Outlooks; projections; descriptions of strategic, operating, and financial plans and objectives; statements of future ambitions and plans; and other statements of future events or conditions in this release, are forward-looking statements. Similarly, discussion of future carbon capture, biofuel and hydrogen plans to drive towards net zero emissions are dependent on future market factors, such as continued technological progress and policy support, and represent forward-looking statements. Actual future results, including financial and operating performance; total capital expenditures and mix, including allocations of capital to low carbon solutions; cost reductions and efficiency gains, including the ability to offset inflationary pressure; plans to reduce future emissions and emissions intensity; timing and outcome of projects to capture and store CO₂, produced biofuels, and use of plastic waste as recycling feedstock; timing and outcome of hydrogen projects; cash flow, dividends and shareholder returns, including the timing and amounts of share repurchases; future debt levels and credit ratings; business and project plans, timing, costs, capacities and returns; achievement of ambitions to reach Scope 1 and Scope 2 net zero from operated assets by 2050; achievement of plans to reach Scope 1 and 2 net zero in Upstream Permian Basin operated assets by 2030; and resource recoveries and production rates could differ materially due to a number of factors. These include global or regional changes in the supply and demand for oil, natural gas, petrochemicals, and feedstocks and other market conditions that impact prices and differentials for our products; variable impacts of trading activities on our margins and results each quarter; actions of competitors and commercial counterparties; the outcome of commercial negotiations, including final agreed terms and conditions; the ability to access debt markets; the ultimate impacts of COVID-19, including the extent and nature of further outbreaks and the effects of government responses on people and economies; reservoir performance, including variability and timing factors applicable to unconventional resources; the outcome of exploration projects and decisions to invest in future reserves; timely completion of development and other construction projects; final management approval of future projects and any changes in the scope, terms, or costs of such projects as approved; changes in law, taxes, or regulation including environmental regulations, trade sanctions, and timely granting of governmental permits and certifications; government policies and support and market demand for low carbon technologies; war, and other political or security disturbances; opportunities for potential investments or divestments and satisfaction of applicable conditions to closing, including regulatory approvals; the capture of efficiencies within and between business lines and the ability to maintain near-term cost reductions as ongoing efficiencies; unforeseen technical or operating difficulties and unplanned maintenance; the development and competitiveness of alternative energy and emission reduction technologies; the results of research programs and the ability to bring new technologies to commercial scale on a cost-competitive basis; and other factors discussed under Item 1A. Risk Factors of ExxonMobil’s 2021 Form 10-K.

Forward-looking and other statements regarding our environmental, social and other sustainability efforts and aspirations are not an indication that these statements are necessarily material to investors or requiring disclosure in our filing with the SEC. In addition, historical, current, and forward-looking environmental, social and sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future, including future rule-making.

Frequently Used Terms and Non-GAAP Measures

This press release includes cash flow from operations and asset sales. Because of the regular nature of our asset management and divestment program, the company believes it is useful for investors to consider proceeds associated with the sales of subsidiaries, property, plant and equipment, and sales and returns of investments together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities. A reconciliation to net cash provided by operating activities for 2021 and 2022 periods is shown on page 7.

This press release also includes cash flow from operations and asset sales excluding working capital. The company believes it is useful for investors to consider these numbers in comparing the underlying performance of the company's business across periods when there are significant period-to-period differences in the amount of changes in working capital. A reconciliation to net cash provided by operating activities for 2021 and 2022 periods is shown on page 7.

This press release also includes earnings/(loss) excluding identified items, which are earnings/(loss) excluding individually significant non-operational events with an absolute corporate total earnings impact of at least $250 million in a given quarter. The earnings/(loss) impact of an identified item for an individual segment may be less than $250 million when the item impacts several periods or several segments. Earnings/(loss) excluding identified items does include non-operational earnings events or impacts that are below the $250 million threshold utilized for identified items. When the effect of these events are material in aggregate, they are indicated in analysis of period results as part of quarterly earnings press release and teleconference materials.

Media Relations
972-940-6007

CALGARY, Alberta--(BUSINESS WIRE)--Imperial Oil Limited (TSE: IMO, NYSE American: IMO) today declared a quarterly dividend of 34 cents per share on the outstanding common shares of the company, payable on October 1, 2022, to shareholders of record at the close of business on September 2, 2022.

This third quarter 2022 dividend compares with the second quarter 2022 dividend of 34 cents per share.

Imperial has a long and successful history of growth and financial stability in Canada as a leading member of the petroleum industry. The company has paid dividends every year for over a century and has increased its annual dividend payment for 27 consecutive years.

Source: Imperial

After more than a century, Imperial continues to be an industry leader in applying technology and innovation to responsibly develop Canada’s energy resources. As Canada’s largest petroleum refiner, a major producer of crude oil, a key petrochemical producer and a leading fuels marketer from coast to coast, our company remains committed to high standards across all areas of our business.

Investor relations
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Media relations
(587) 476-7010

Second Quarter Highlights include:

• Reported second quarter revenues of $185.0 million and net income of $9.1 million;
• Reduced net leverage ratio to 1.18x as of June 30, 2022 from 1.40x as of March 31, 2022;
• Delivered second quarter Adjusted EBITDA of $37.1 million;
• Awarded a 12-year contract renewal at Wapasu Lodge in the Canadian oil sands including approximately C$500 million of guaranteed take-or-pay revenues; and
• Today announced a 5-year integrated services contract with a new customer in South Australia with expected revenues of A$120 million.

HOUSTON & CALGARY, Alberta--(BUSINESS WIRE)--Civeo Corporation (NYSE:CVEO) today reported financial and operating results for the second quarter ended June 30, 2022.

"In the second quarter of 2022, Civeo’s focus remained on operating safely, generating free cash flow and reducing our debt balance. Our Canadian business experienced increasing customer activity in the Canadian oil sands and robust pipeline work. In Australia, metallurgical coal and iron ore prices remained high, which is reflected in improved billed rooms both sequentially and year over year," stated Bradley J. Dodson, Civeo's President and Chief Executive Officer.

Mr. Dodson continued, "We continue to prioritize operational execution with our customers and guests, and we were pleased to announce earlier this month a twelve-year contract renewal at our Wapasu Lodge. This contract is an example of our strategy of collaborating with our long-term partners to maximize value in the current operating environment in a mutually beneficial way."

Mr. Dodson concluded, "We are excited about our recent integrated services contract award from a copper mining company in South Australia. This contract award is a testament to our integrated services growth and diversification potential as it encompasses a new customer, a new state in Australia and a new commodity."

Second Quarter 2022 Results

In the second quarter of 2022, Civeo generated revenues of $185.0 million and reported net income of $9.1 million, or $0.54 per diluted share. During the second quarter of 2022, Civeo produced operating cash flow of $21.7 million, Adjusted EBITDA of $37.1 million and free cash flow of $17.6 million.

By comparison, in the second quarter of 2021, Civeo generated revenues of $154.2 million and reported a net loss of $0.5 million, or $0.03 per diluted share. The loss resulted in part from $7.9 million in costs associated with asset impairments on properties in Australia. During the second quarter of 2021, Civeo produced operating cash flow of $16.5 million, Adjusted EBITDA of $32.2 million and free cash flow of $13.7 million.

Overall, the increase in revenues and Adjusted EBITDA in the second quarter of 2022 compared to the second quarter of 2021 was primarily driven by improved occupancy in the Canadian lodges and increased Canadian mobile camp activity, as well as an increase in Australian village billed rooms.

Business Segment Results

(Unless otherwise noted, the following discussion compares the quarterly results for the second quarter of 2022 to the results for the second quarter of 2021.)

Canada

During the second quarter of 2022, the Canadian segment generated revenues of $109.0 million, operating income of $11.2 million and Adjusted EBITDA of $28.7 million, compared to revenues of $83.3 million, operating income of $7.5 million and Adjusted EBITDA of $22.6 million in the second quarter of 2021. Results from the second quarter of 2022 reflect the impact of a weakened Canadian dollar relative to the U.S. dollar, which decreased revenues and Adjusted EBITDA by $4.4 million and $1.2 million, respectively.

On a constant currency basis, the Canadian segment experienced a 36% period-over-period increase in revenues largely due to increased mobile camp activity, as well as a 7% year-over-year increase in billed rooms, driven by increased customer activity as a result of the recovery of oil prices and a reduced impact from COVID-19. Adjusted EBITDA for the Canadian segment increased 32% year-over-year primarily due to the aforementioned dynamics.

Australia

During the second quarter of 2022, the Australian segment generated revenues of $67.8 million, operating income of $5.5 million and Adjusted EBITDA of $15.5 million, compared to revenues of $64.0 million, operating loss of $2.7 million and Adjusted EBITDA of $15.4 million in the second quarter of 2021. Operating loss for the second quarter of 2021 included asset impairment charges of $7.9 million. Results from the second quarter of 2022 reflect the impact of a weakened Australian dollar relative to the U.S. dollar, which decreased revenues and Adjusted EBITDA by $5.3 million and $1.2 million, respectively.

On a constant currency basis, the Australian segment experienced a 14% period-over-period increase in revenues, driven by an 8% year-over-year increase in billed rooms due to increased customer maintenance activity in the Bowen Basin. Adjusted EBITDA from the Australian segment increased 8% year-over-year due to higher village occupancy in the Bowen Basin, partially offset by increased costs of temporary labor due to ongoing labor shortages.

U.S.

The U.S. segment generated revenues of $8.1 million, an operating loss of $1.3 million and Adjusted EBITDA of $0.2 million in the second quarter of 2022, compared to revenues of $6.9 million, an operating loss of $1.1 million and Adjusted EBITDA of $0.3 million in the second quarter of 2021. Revenues increased year-over-year primarily due to the increased drilling activity positively impacting our wellsite services business, partially offset by the sale of the West Permian lodge in the fourth quarter of 2021. Adjusted EBITDA decreased slightly year-over-year primarily due to the sale of the West Permian lodge, largely offset by increased drilling activity positively impacting our wellsite services business.

Financial Condition

As of June 30, 2022, Civeo had total liquidity of approximately $95.3 million, consisting of $90.5 million available under its revolving credit facilities and $4.8 million of cash on hand.

Civeo’s total debt outstanding on June 30, 2022 was $154.6 million, a $23.3 million decrease since March 31, 2022. The decrease consisted of $18.0 million in debt payments from cash flow generated by the business and favorable foreign currency translation of $5.3 million.

Civeo reduced its net leverage ratio to 1.18x as of June 30, 2022 from 1.40x as of March 31, 2022.

During the second quarter of 2022, Civeo invested $5.1 million in capital expenditures compared to $3.2 million invested during the second quarter of 2021. Capital expenditures in both periods were predominantly related to maintenance spending on the Company’s lodges and villages.

Full Year 2022 Guidance

For the full year of 2022, Civeo is increasing its previously provided revenue and Adjusted EBITDA guidance range to $660 million to $675 million and $95 million to $105 million, respectively. As previously disclosed when the Company announced the contract renewal for its Wapasu Lodge earlier this month, the Company is raising its full year 2022 capital expenditure guidance to $24 million to $29 million.

Conference Call

Civeo will host a conference call to discuss its second quarter 2022 financial results today at 11:00 a.m. Eastern time. This call is being webcast and can be accessed at Civeo's website at www.civeo.com. Participants may also join the conference call by dialing (877) 423-9813 in the United States or (201) 689-8573 internationally and using the conference ID 13731837#. A replay will be available after the call by dialing (844) 512-2921 in the United States or (412) 317-6671 internationally and using the conference ID 13731837#.

About Civeo

Civeo Corporation is a leading provider of hospitality services with prominent market positions in the Canadian oil sands and the Australian natural resource regions. Civeo offers comprehensive solutions for lodging hundreds or thousands of workers with its long-term and temporary accommodations and provides food services, housekeeping, facility management, laundry, water and wastewater treatment, power generation, communications systems, security and logistics services. Civeo currently operates a total of 27 lodges and villages in Canada, Australia and the U.S., with an aggregate of over 28,000 rooms. Civeo is publicly traded under the symbol CVEO on the New York Stock Exchange. For more information, please visit Civeo's website at www.civeo.com.

Forward Looking Statements

This news release contains forward-looking statements within the meaning of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are those that do not state historical facts and are, therefore, inherently subject to risks and uncertainties. The forward-looking statements herein include the statements regarding Civeo’s future plans and outlook, including guidance, current trends and liquidity needs, and ability to pay down debt are based on then current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. Such risks and uncertainties include, among other things, risks associated with global health concerns and pandemics, including the COVID-19 pandemic, any increases in or severity of COVID-19 cases (including due to existing or new variants) and the risk that room occupancy may decline if our customers are limited or restricted in the availability of personnel who may become ill or be subjected to quarantine, risks associated with the general nature of the accommodations industry, risks associated with the level of supply and demand for oil, coal, iron ore and other minerals, including the level of activity, spending and developments in the Canadian oil sands, the level of demand for coal and other natural resources from, and investments and opportunities in, Australia, and fluctuations or sharp declines in the current and future prices of oil, natural gas, coal, iron ore and other minerals, risks associated with failure by our customers to reach positive final investment decisions on, or otherwise not complete, projects with respect to which we have been awarded contracts, which may cause those customers to terminate or postpone contracts, risks associated with currency exchange rates, risks associated with the company’s ability to integrate acquisitions, risks associated with labor shortages, risks associated with the development of new projects, including whether such projects will continue in the future, risks associated with the trading price of the company’s common shares, availability and cost of capital, risks associated with general global economic conditions, inflation, global weather conditions, natural disasters and security threats and changes to government and environmental regulations, including climate change, and other factors discussed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of Civeo’s most recent annual report on Form 10-K and other reports the company may file from time to time with the U.S. Securities and Exchange Commission. Each forward-looking statement contained herein speaks only as of the date of this release. Except as required by law, Civeo expressly disclaims any intention or obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Information

EBITDA is a non-GAAP financial measure that is defined as net income (loss) plus interest, taxes, depreciation and amortization, and Adjusted EBITDA is defined as EBITDA adjusted to exclude certain other unusual or non-operating items. Free cash flow is a non-GAAP financial measure that is defined as net cash flows provided by operating activities less capital expenditures plus proceeds from asset sales.

See “Non-GAAP Reconciliation” below for additional information concerning non-GAAP financial measures, including a reconciliation of the non-GAAP financial information presented in this press release to the most directly comparable financial information presented in accordance with GAAP. Non-GAAP financial information supplements and should be read together with, and is not an alternative or substitute for, the Company’s financial results reported in accordance with GAAP. Because non-GAAP financial information is not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures.

- Financial Schedules Follow -