Chevron Unveils $20B Capital Expenditure Budget For 2019
Zacks Investment Research | Dec 06, 2018 08:14PM ET
Chevron Corporation (NYSE:CVX) recently announced its capital and exploratory spending program for 2019. The budget for capital projects is reserved at $20 billion, higher than 2018’s projected investment of $18.3 billion. Notably, this marks the first budget increase in four years and reflects a 9.3% annual increase.
Chevron’s upstream spending in 2019 is expected to increase 9.5% from 2018, which can enable the company to deliver steady growth in production. Downstream expenditure of the company will likely increase 13.6% in 2019. Moreover, the company expects 66.7% of its 2019 capital spending to realize cash flow by two years.
Upstream: Chevron allocated 86.5% of its total budget toward upstream operations. The company has plans to spend $7.6 billion in the upstream projects located in the United States and $9.7 billion in the international upstream projects. The company will use around $10.4 billion to develop and grow its present producing assets, of which $3.6 billion will allocated to the Permian Basin and $1.6 billion for other shale related developments.
Moreover, for the major capital projects underway, the company plans to allocate $5.1 billion, of which 84.3% will likely be spent on Kazakhstan’s Future Growth Project, located in the Tengiz field. Chevron plans to fund nearly $1.3 billion for its global exploration.
Downstream: Capital spending in the downstream segment is expected to be $2.5 billion in 2019, higher than last three year’s flat budget of $2.2 billion. Of this total amount, 60% will be used for the projects in the United States and the rest will be allocated for international downstream operations. The company’s downstream businesses include refining, marketing and transporting fuels. It also manufactures as well as distributes additives, lubricants, and petrochemicals.
Other: The company is expected to spend approximately $200 million, which is 33.3% higher than 2018’s budget, for other activities in 2019.
Price Performance
San Ramon-based Chevron is one of the largest publicly traded oil and gas companies in the world. It has lost 3.1% in the past year compared with 1.7% collective fall of the Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.