Chevron Corporation Overview

The company engages in different aspects of natural gas, oil, and geothermal energy sectors. This means that the company takes part in activities such as exploration and production of hydrocarbons, refining, marketing and transporting, manufacturing and selling of chemicals. It also engages in generating power. The company’s upstream operations include oil and gas exploration as well as production of oil and gas. It also produces various commodities in its downstream operations. Chevron has its upstream operations in the Northwest Territories, especially the Beaufort Sea region. In 2017, the average daily net oil-equivalent was 98,000 barrels, 36,000 barrels of crude oil, 51,000 barrels of synthetic oil obtained from oil sands, and 65,000,000 cubic feet of natural gas. Products from downstream operations The company takes part in various downstream operations such as manufacturing and selling products including petrochemicals, additives, lubricants, and fuels.

Most of the company’s downstream areas of operations include the United States Gulf Coast, South Africa, Northern part of America, South Korea, Australia, and the Southeast Asia. The company’s alternative energy operations are such as hydrogen, fuel cells, biofuel, geothermal, solar, and wind power. The other Chevron’s products include research and development which enables the company to facilitate its upstream and downstream activities. Analysis of Trends Trends in Chevron’s Earnings In terms of international upstream earnings, Chevron had $4. 51 billion in 2017. This was a positive figure compared to the loss of $483 that was encountered in 2016. The increase in the earnings figure can be associated with the increased crude oil realization of $2. 94 billion which was an increase from the earnings in 2016 valued at $1.

31 billion. This positive growth is associated with the US tax reforms which led to a benefit of $1. 16 billion. It is also attributed to increased margins on refined commodity sales valued at $380 million, decline in operating expenses for $160 million, and reduction in the impairment of assets for $110 million. This was $0. 15 billion higher than the earnings in 2016. The rise in earnings was majorly because of the increased gains on the value of assets at $360 billion. It was also as a result decrease in operating expenses that were worth $140 million. However, between 2017 and 2016, the company encountered negative impacts from foreign currency effects of $65. This rise is associated with increase in refined products, higher prices for crude oil, increased production of crude oil, and high volumes of natural gas.

However, the sales and other operating revenues decreased from $129,925 in 2015 to $110,215 in 2016. The decline is explained by lower volumes of natural gas and crude oil production, and lower crude oil prices. Trends in Chevron’s income from equity affiliates (in millions) There is a rise in income from equity affiliates from $2,661 in 2016 to $4,438 in 2017. The increase is attributed with increase in upstream-based earnings from Angola and Kazakhstan. Trends in Chevron’s Total revenues and other income (in millions) From a general perspective, it is noticeable that total revenues increase from the year 2015 to 2017. However, the total revenues and other income decreased from $138,477 in 2015 to $114,472. This huge decrease is associated with decrease in the price of crude oil as well as decreases in the production volumes of natural gas and crude oil.

However, the total revenues and other income increased from $114,472 in 2016 to $141,722 in 2017. This huge increase is attributed with increased prices on crude oil and natural gas. However, this technique prevents the company from predicting with certainty the values of additional investments in new or previous technologies or facilities. It also prevents the company from forecasting with certainty the values of increasing operating costs to be encountered in the future for the purpose of preventing, controlling, reducing, or eliminating environmental hazards to the atmosphere. The company has from time to time incurred expenses for corrective activities at different owned facilities and third-party-owned water disposal sites utilized by the firm. At other times, Chevron incurs costs in terms of obligations which arises when operations are terminated or traded at sites not owned by Chevron.

The other Chevron’s cost management issue is as a result of different routine evaluation from major debt rating agencies. Precisely, the increase in total costs and other deductions in 2017 can be associated with cost inflation in the industry in the most onshore regions such as North America. Exploratory costs, capital expenses, and operating costs are unexpectedly influenced by destruction of production facilities triggered by hostile weather, unsuitable political climate, and delays in construction and production.  Report on segments, divisions, or any other reporting entities and on any diversity in products. Week 3 1. Inventory comments: costing information.  Comment on the management of risk and uncertainty as discussed in the Management Discussion & Analysis (MD&A) report. Divisions and Product Lines may be discussed in the MD&A section.

 What cost accounting issues may arise in these areas as you consider our chapters for the week. Management often explains higher or lower than expected in their comments. Discuss the profitability and other comments in the MD&A section as they relate to our chapters thus on budgets, variance analysis, and management. How might these probable or possible cost issues impact the profitability of your manufacturing company? 4.  Does management disclose any information about Corporate Social Responsibility (CSR) and Sustainability policies? How would this emerging framework impact on cost and profitability for your corporation? (NOTE: Some large multinational corporations maintain a separate CSR and/or Sustainability website. ) Chevron’s management discloses information about its corporate social responsibility (CSR) and sustainability policies. Corporate Social Responsibility (CSR) and Sustainability relate to many issues including pollution and the cost of remediation and hazardous wastes.