Chevron reported quarterly earnings that beat analysts’ expectations on Friday, as record-setting oil and gas production boosted the company’s bottom line.
Shares of the oil major were rose more than 2 percent on Friday.
Chevron posted a profit of $4.05 billion for the quarter, more than double its earnings from a year ago. That came out to a profit of $2.11 per share, slightly beating Wall Street’s expectations for $2.06 per share, according to Refinitiv.
“Our strong financial results reflect higher production and crude oil prices coupled with a continued focus on efficiency and productivity,” Chairman and CEO Michael Wirth said in a statement.
The company pumped nearly 3 million barrels per day of oil equivalent, the most it’s ever produced in a single quarter. The gains came as Chevron ramped up production from its Wheatstone liquefied natural gas project in Australia and as output continued to surge from its wells in the Permian Basin underlying Texas and New Mexico.
That helped drive a nearly seven-fold jump from third-quarter 2017 earnings in Chevron’s oil and gas exploration and production business, where profits hit $3.38 billion this quarter.
Chevron’s other major business line, refining and marketing fuels like gasoline and diesel, saw profits drop 24 percent. The decline was largely due to Chevron’s international refining business, where profit margins were lower and the company sold fewer assets compared with a year ago.
Weak profit margins in the overseas refining business also weighed on Chevron’s bottom line last quarter, though the earnings improved over the last three-month period.
Last week, Reuters reported that Chevron is in talks to buy a Pasadena, Texas refinery, which would be its first Houston-area facility. The refinery would give Chevron control of a processing facility relatively close to its Permian wells and position it near the Gulf of Mexico exporting hub.
Profits were also bolstered by $930 million worth of financial items including a write-off, an asset impairment and a contractual settlement, as well as Chevron’s $350 million sale of African refining, marketing and lubricant assets.
Chevron’s revenue increased by 21 percent from a year ago to $43.99 billion, but still came in light of estimates. Analysts had expected $46.67 billion in quarterly sales.
Shares of Chevron are down nearly 10 percent this year, with much of that decline coming over the last three months, despite the company announcing a $3 billion-per-year stock buyback program when it last reported quarterly earnings.