|
Press Releases | |
|---|---|
EIA ReportsU.S. ENERGY INFORMATION ADMINISTRATION Major U.S. Energy Companies Make Record Profits on Eve of 1998 Oil Price CollapseNet income of two dozen major U.S. energy companies was $32.1 billion in 1997, a second consecutive record, despite a $2-per-barrel decline in world oil prices, according to data released today by the Energy Information Administration (EIA) in Performance Profiles of Major Energy Producers 1997. The majors' income from upstream operations (oil and gas exploration and production) changed little between 1996 and 1997, as higher worldwide natural gas production and prices and increased oil production outside the United States offset the effects of lower oil prices. Capital expenditures for all lines of business of the major energy companies totaled $61.9 billion in 1997, up 24 percent from the prior year. The surge in capital expenditures reflected a sustained strong interest in oil and gas exploration and development even though oil prices were down and income from oil and gas production was flat. Canada and onshore U.S. locales, two areas that have been in the least favor as upstream targets of investment in the 1990's, were prominent in the growth of the majors' exploration and development spending in 1997. Oil and gas prospects in the Federal Outer Continental Shelf (OCS) continued to attract added investment. The majors' expenditures for OCS exploration and development totaled $8.8 billion in 1997, up $2.1 billion from 1996 expenditures and triple the level of expenditures in 1992. The profitability of the majors' U.S. refining and marketing operations was at its highest level in the 1990's (see Figure), yet domestic petroleum refining was the focus of the majors' largest cutback in capital expenditures in 1997. Capital expenditures for these operations were down 20 percent from prior-year expenditures, falling to $1.7 billion, the lowest level since 1978. The steady decline from the all-time peak expenditures of $5.2 billion in 1992 reflected in part the majors' reactions to the low profitability of U.S. refining in the first half of the 1990's and in part the completion of environmental quality projects. Performance Profiles of Major Energy Producers 1997 discusses these and other key financial developments in detail and reviews the major energy companies' activities in petroleum, natural gas, coal, other energy, and nonenergy businesses. The report includes analyses of selected emerging issues in financial performance, energy market structure, resource development activity, and a chapter on foreign direct investment in U.S. energy assets. Performance Profiles of Major Energy Producers 1997 can be accessed via the Worldwide Web at http://www.eia.doe.gov. The direct Internet address is: http://www.eia.doe.gov/emeu/perfpro/. Printed copies of the report will be available from the U.S. Government Printing Office, 202-512-1800, or through EIA's National Energy Information Center, 202/586-8800, on or about January 27, 1999.
EIA Program Contact: Jon A. Rasmussen, 202/586-1449, jon.rasmussen@eia.doe.gov EIA-99-03 Contact:
|
Total net income of the majors (excluding the effect of unusual items such as litigation settlements) was up $3.5 billion in 1997 compared to the 1996 level. Income from petroleum refining and marketing led the upswing in financial performance, accounting for $2.6 billion of this increase. The onset of the Asian currency crisis in the second half of the year did not offset the generally strong worldwide demand for petroleum products in 1997.