10-KPeriod: FY2012

CHEVRON CORP Annual Report, Year Ended Dec 31, 2012

Filed February 22, 2013For Securities:CVX

Summary

Chevron Corporation's 2012 10-K filing highlights a robust, globally diversified business focused on upstream exploration and production, as well as downstream refining and marketing. The company demonstrated significant capital investment in 2012, totaling $34.2 billion, with a strong emphasis on upstream activities, particularly in international regions. This investment signals a commitment to future growth and resource replacement, crucial for an extractive industry. Financially, Chevron navigated a complex operating environment influenced by fluctuating commodity prices and geopolitical factors. The company's strategic direction emphasized shareholder value creation through profitable growth in core upstream areas, commercializing its natural gas base, and improving downstream returns. While the report details extensive exploration and development projects across multiple continents, it also acknowledges inherent risks such as commodity price volatility, operational disruptions, and regulatory changes, particularly concerning environmental standards and greenhouse gas emissions.

Financial Statements
Beta
Revenue$241.91B
R&D Expenses$648.00M
SG&A Expenses$4.72B
Operating Expenses$195.58B
Interest Expense$0
Net Income$26.18B
EPS (Basic)$13.42
EPS (Diluted)$13.32
Shares Outstanding (Basic)1.95B
Shares Outstanding (Diluted)1.97B

Key Highlights

  • 1Chevron invested heavily in 2012, with $34.2 billion in capital and exploratory expenditures, primarily directed towards upstream activities (89% of total expenditures).
  • 2International upstream operations accounted for a significant portion of capital spending, representing about 72% of worldwide upstream investment in 2012.
  • 3The company's net proved reserves stood at 11,347 million barrels of oil equivalent at the end of 2012, showing a slight increase from the previous year.
  • 4Chevron operates a diversified downstream business with approximately 2.0 million barrels per day of crude oil processing capacity across its refining network.
  • 5The company markets its products globally under well-recognized brands like Chevron, Texaco, and Caltex, serving approximately 8,060 branded service stations in the U.S. and 8,700 internationally.
  • 6Significant investments are being made in major upstream projects such as the Gorgon and Wheatstone LNG facilities in Australia, and deepwater projects in the U.S. Gulf of Mexico.
  • 7The company detailed its strategic direction to create shareholder value through profitable upstream growth and improved downstream returns, while also investing in renewable energy and energy efficiency solutions.

Frequently Asked Questions

Chevron's primary investment focus in 2012 was on upstream activities, which accounted for 89% of its total capital and exploratory expenditures of $34.2 billion. A significant portion of this upstream investment, approximately 72%, was directed towards international operations.

Chevron acknowledges the inherent volatility of commodity prices as a significant risk factor in its business. The company's strategy involves accepting this risk as part of its business planning process, focusing on replacing produced resources and managing its portfolio to mitigate the impact of price fluctuations on upstream earnings and capital programs.

Chevron estimated its average worldwide oil-equivalent production in 2013 to be approximately 2.650 million barrels per day, based on an average Brent price of $112 per barrel in 2012. However, this estimate is subject to various uncertainties including OPEC quotas, price effects on entitlement volumes, geopolitical events, and operational disruptions.

Chevron is involved in several large-scale projects, including the Gorgon and Wheatstone LNG facilities in Australia, the Jack and St. Malo fields and the Big Foot project in the U.S. Gulf of Mexico, and significant developments in Angola and Kazakhstan, such as the Mafumeira Field development and the Tengizchevroil (TCO) projects.