Zinger Key Points
- Chevron projects 2025 capital expenditure of $14.5-$15.5 billion, focusing on U.S. upstream and carbon reduction projects.
- Q4 2024 includes $0.7-$0.9 billion restructuring charges and $0.4-$0.6 billion in non-cash after-tax charges.
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On Thursday, Chevron Corporation CVX provided fourth-quarter updates and disclosed a 2025 organic capital expenditure budget.
Fourth-quarter 2024 update: The company expects to incur a restructuring charge of $0.7 billion to $0.9 billion after-tax with cash outflows spread over the next two years.
This is at par with the company’s plans to achieve $2 to $3 billion in structural cost reductions by 2026.
Additionally, Chevron anticipates non-cash, after-tax charges of $0.4 to $0.6 billion in the fourth quarter related to impairments, asset sales, and other obligations.
Read: Chevron Posts Q3 Beat As ‘Uncertainty Around Hess Deal Remains,’ Analysts Say
Outlook: For 2025, the company expects organic capital expenditure of $14.5 to $15.5 billion for consolidated subsidiaries and $1.7 to $2.0 billion for affiliate capital expenditures.
Chevron expects $13 billion in upstream spending for 2025, with two-thirds focused on its U.S. portfolio.
Permian Basin spending is projected to decrease to $4.5–$5.0 billion, prioritizing free cash flow over production growth. The remaining U.S. investment targets the DJ Basin and Gulf of Mexico, aiming for 300 mboed offshore production by 2026.
Internationally, the company has allocated $1.0 billion for Australia, including Gorgon backfill.
Downstream capex is set at $1.2 billion, with two-thirds for the U.S. About $1.5 billion across both segments will focus on carbon reduction and New Energies growth, while corporate capex is projected at $0.7 billion.
Chevron Chairman and CEO Mike Wirth said, “The 2025 capital budget along with our announced structural cost reductions demonstrate our commitment to cost and capital discipline,”
“We continue to invest in high-return, lower-carbon projects that position the company to deliver free cash flow growth.”
Investors can gain exposure to CVX through the EA Series Trust Strive U.S. Energy ETF DRLL and the Westwood Salient Enhanced Energy Income ETF WEEI.
Price Action: CVX shares are down 2.29% to $155.68 at the last check on Friday.
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