Chevron could raise Venezuelan output further: Update

Chevron said its crude output in Venezuela could increase by 50pc this year from current levels of around 100,000 b/d "if everything goes well."

Late last year, the company was cleared by the US government to resume some work in its joint ventures with Venezuela state-owned PdV after sanctions were eased against the nation.

"We just have to take this one step at a time," chief executive officer Mike Wirth told investors on a call today. "There's a lot of relatively straightforward workover activity that can help bring production up, without major capital commitments."

Asked whether Chevron was seeking an extension of its current six-month license, Wirth said any further sanctions waivers would be decided in Washington. "That's a decision made by the US government, it's not really a negotiation, it's their decision," he said.

Chevron has also started crude oil liftings from Venezuela, supplying 8.7mn bl to the US during the first three months of the year.

Chevron's global production fell slightly in the first quarter because of the expiration of a contract in Thailand and the sale of its Eagle Ford shale assets in Texas.

Worldwide output declined 3pc to about 2.98mn b/d of oil equivalent (boe/d) from the first three months of 2022. The decline was partially offset by a 4pc increase in Permian basin output in Texas and New Mexico.

"We expect 2023 production growth in the Permian to be back-end loaded as wells put on production increase across both operated and non-operated areas," the company said.

Full-year output from the Permian is expected to be up by 10pc from 2022.

First quarter profit rose to $6.6bn from $6.3bn a year earlier.

Chevron attributed the increase to higher margins on refined product sales, partly offset by lower oil and natural gas prices.

During the first quarter, the company started up the Mad Dog 2 project in the US Gulf of Mexico.

The producer boosted its dividend by about 6pc in the quarter, and also increased the annual share buyback rate to $17.5bn.

"We're delivering strong financial results and increasing cash returned to shareholders," Wirth said.

Chevron booked a $130mn charge related to changes in the energy profits levy in the UK during the quarter.

By Stephen Cunningham