HOUSTON (Dow Jones)–Chevron Corp. (CVX) said Wednesday it expects to spend a record $32.7 billion on capital projects in 2012 as it continues to invest in massive oil and gas projects worldwide.
Chevron’s 2012 capital expenditure budget is 17% higher than the $28 billion the oil giant said it spent this year, its highest level of spending ever. Rivals ConocoPhillips (COP) and Marathon Oil Corp. (MRO) recently announced double-digit capital budget increases for next year, showing major oil companies are confident about the sustainability of high oil prices.
Chevron, the second-largest U.S. oil company by market value after Exxon Mobil Corp. (XOM), is planning to spend about 87%, or $28.5 billion, of its budget next year on exploration and production projects in Australia, the deep waters of the U.S. Gulf of Mexico, Nigeria, Angola and China, the company said in a press release. Planned capital spending is also directed toward improving crude oil and natural gas recovery and reducing declines in production that take place in existing fields over time, the company added.
Chevron’s 2012 capital program includes spending of nearly $9 billion in the U.S., with major new investments in the Gulf of Mexico, the Marcellus Shale fields in Pennsylvania and at the company’s Pascagoula, Miss. refinery, the company said.
Chevron expects to spend $3 billion next year in exploration projects, including the appraisal of new acreage acquired in the past two years in Liberia, China and various international shale gas possibilities. The planned spending also includes more exploration and appraisal activity in western Australia, the Gulf of Mexico and western Africa.
The company budgeted $3.6 billion in 2012 for its refining and marketing operations and about $600 million for technology, power generation and other activities.
-By Isabel Ordonez, Dow Jones Newswires