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By Sabrina Valle and Mrinalika Roy
HOUSTON (Reuters) - Chevron on Friday posted a third-quarter profit that missed Wall Street estimates by a wide margin, sending its shares down 6%.
Oil company earnings have slumped from record year-ago levels as crude prices eased and higher costs crimped refining and chemical profits.
Shares were down $9.46, or 6.1%, to $145.29 in midday trading.
"It was a noisy quarter with non-cash charges due primarily something we called timing effects," Chief Financial Officer Pierre Breber told Reuters, citing oil and gas cargoes en route to customers that would be recognized in the future.
The company earned $6.5 billion, down from $11.2 billion in the same period last year. Adjusted profit was $3.05 a share, compared to analysts' expected $3.75 per share, according to LSEG data.
The earnings miss came after Chevron had warned in the second quarter that maintenance in its oil and gas production and refining businesses would hurt results.
It also suffered a setback in a Kazakhstan project, with increased costs and a six-month delay in expanding oil and gas production at its Tengizchevroil (TCO) operation. Chevron's proceeds from TCO will be about $2.5 billion less than anticipated over the next two years, officials said.
Exxon and TotalEnergies also posted lower third-quarter results on weaker crude oil and refining profits, with Exxon's profit down 54% and TotalEnergies' off 35%.
ACQUISITIONS, SPENDING
Chevron agreed to buy U.S. rival Hess Corp for $53 billion in an all-stock deal that expands its shale and deepwater oil production and reserves. It also acquired U.S. shale oil and gas producer PDC Energy and a majority stake in ACES Delta, a U.S. hydrogen storage firm, in recent months.
Capital expenditures during the quarter rose more than 50% to $4.7 billion, in part on the acquisition of hydrogen firm ACES Delta and PDC Energy.
Profit from pumping oil and gas fell about 38% to $5.76 billion in the quarter from $9.3 billion a year ago. Cash flow from operations fell to $9.7 billion from $15.3 billion a year ago.
Overall, volumes rose 4% to 3.15 million barrels of oil and gas per day (boed) on the PDC Energy deal, which increased the production of less-lucrative natural gas by 25%. Chevron pumped 3.03 million boed a year ago.
Refining posted an operating profit of $1.68 billion, down from $2.53 billion a year ago on sharply lower results outside the United States, where margins and inputs fell.
OUTLOOK
Production at Tengizchevroil will be down about 50,000 barrels per day next year due to maintenance and equipment conversions, officials said.
Fourth-quarter results could suffer if a production halt at its Tamar gas field off the coast of Israel continues throughout the quarter. Operations there were stopped following the Oct. 7 Hamas attacks on the country.
Chevron's larger Leviathan gas field continues to be operational, with Breber declining to speculate about possible interruptions because of the Hamas-Israel conflict.
"It is a serious situation," he said.
(Reporting by Mrinalika Roy in Bengaluru and Gary McWilliams in Houston; Editing by Arun Koyyur, Chizu Nomiyama and Mark Porter)
