Investors are putting increased pressure on the world's biggest oil
companies to rein in spending and return more money to shareholders — a trend Royal Dutch Shell Plc <RDSa.L> recently warned against
because it may create oil shortages in the future.
Chevron's latest capital and exploratory budget compares with $42
billion in expected investments this year, far more than the $36.7
billion the company originally budgeted. Larger rival Exxon Mobil
Corp's <XOM.N> 2013 budget was $38 billion.
In a statement, Chief Executive John Watson said 2013 would be "a
relative peak year for investments," while 2014 would be a peak year
for spending on the company's Australian liquefied natural gas
Chevron was forced to add billions to the total cost of the Gorgon
liquefied natural gas (LNG) export complex in Australia — a $54
billion giant where costs were inflated by labor shortages and
foreign exchange movements.
Chevron owns 47 percent of Gorgon, while Exxon and Shell each hold
25 percent stakes and the rest is shared by Japanese LNG buyers.
Chevron's overall LNG production, including that from another
Australian plant being built called Wheatstone and a newly opened
development in Angola, is expected to double to the oil-equivalent
of 460,000 barrels per day (boepd) in 2017.
That is a major part of the production Chevron plans to add as it
pursues its 2017 production target of 3.3 million boepd, up from
about 2.6 million currently.
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Closer to home, Chevron has three projects in the works in the Gulf
of Mexico: Jack/St Malo, Big Foot and Tubular Bells. The Jack/St.
Malo project is scheduled to start next year, while the Big Foot
project is forecast to start in the second quarter of 2015, Chevron
The San Ramon, California-based company also included in its list of
major projects the expansion of the Caspian Pipeline in Kazakhstan
and Russia and development of the Usan and Agbami deepwater fields
in Nigeria, among others.
As for the "downstream" budget for refining and chemicals, Chevron
set that at $3.1 billion, compared with a budget of $2.7 billion
(Reporting By Thyagaraju Adinarayan in
Bangalore and Nichola Groom in Los Angeles; editing by Maju Samuel
and L Gevirtz)
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