But operating costs are also rising, writes Martyn Wingrove, Lloyds List
Published: Aug 03, 2006
US OIL companies have benefited from surging international crude and natural gas prices, but their capital and operating spending is rising.
After ExxonMobil, BP and Shell reported record quarterly earnings and income, the large US companies followed with their own strong results.
Rising costs of oilfield equipment and contracting services is pushing up oil company spending, but there are no worries as long as oil prices remain high.
Chevron, which acquired Unocal last year, reported second quarter net income of $4.4bn compared with $3.7bn for the same period last year. Its upstream earnings were driven up by high oil prices to $3.27bn.
Chevron, spent $4bn onprojects and was hit with a $300m charge for dismantling the Typhoon platform, which turned upside down in last year’s hurricanes. It was also hit with a $200m charge from increased UK taxes.
Strong refining margins and 100% utilisation helped Chevron’s downstream earnings surge to almost $1bn.
‘The earnings improvement in the second quarter was driven mainly by our upstream business outside the US,’ said Chevron’s chairman and chief executive Dave O’Reilly.
Its rival ConocoPhillips saw its net income rocket up to $5.18bn from $3.14bn for the same period last year through the acquisition of Burlington Resources and rising Timor Sea production.
In the second quarter, ConocoPhillips had revenues of $47bn, cash from operations of $4.8bn and it reduced debt by $2.7bn as it produced 2.1m barrels per day.
‘We delivered solid results in the second quarter with progress made on integrating Burlington Resources operations into our global portfolio,’ said ConocoPhillips’ chairman and chief executive Jim Mulva.
New projects and oilfield cost inflation has pushed the firm’s 2006 spending to around $18bn, 50% more than in last year.
Increasing production and asset acquisitions helped Houston company Apache to record second quarter earnings of $722m. By buying Pioneer’s Argentine operations and bringing the Qasr field in Egypt and John Brookes off Australia on-stream, Apache saw its output grow to 500,800 barrels per day.
Also in Houston, Anadarko, which is in the process of buying Kerr-McGee and Western Gas Resources, reported net income of $814m and cash flow of $957m for the second quarter.
‘Our investments in the deepwater Gulf of Mexico and US tight gas sands are delivering results,’ said Anadar- ko chairman Jim Hackett. ‘These are core areas that will become even greater focus for our company in the future through our pending acquisitions.’
Canadian firm Talisman Energy reported its second quarter net income had doubled to $686m and its cash flow from operations climbed 15% to $1.1bn. This was driven by a 6% rise in production to 472,000 barrels per day due to projects in Asia and wells in the North Sea.
‘Our major projects are proceeding including 10 subsea tie backs in the North Sea, the largest of these, Tweedsmuir, is 69% completed and should be on-stream towards the end of the first quarter 2007,’ said Talisman’s president, Jim Buckee.
Nexen of Calgary reported cash flow of $729m and earnings of $406m in the second quarter, with production at 215,000 barrels per day. This is expecting to surge ahead before the end of this year as it works to develop the Buzzard oilfield in the North Sea.
‘With the platforms installed on Buzzard we are another step closer to delivering strong production growth later this year,’ said chief executive Charlie Fischer.
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Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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A head-cut image of Alfred Donovan (now deceased) appears courtesy of The Wall Street Journal.
