What are we doing that is so different? I highly doubt that the headcount reductions that other companies have gone through are saving them that much money.
Continued capital expenses? Are we hiding something in the balance sheets to look better in '21? Anyone know the drastic difference?
From a recent WoodMac report:
Portfolios perform very differently under our Low (US$30/bbl, real 2020, long-term), Base
(US$50/bbl) and High (US$70/bbl) oil price scenarios.
ExxonMobil is the most leveraged to higher prices, BP the most ‘defensive’. The latter’s large domestic gas assets mean it loses or gains less than its peers when oil prices fluctuate.
Divesting the ‘weakest’ assets doesn’t always strengthen a portfolio, as many are highly price sensitive. Much depends on the longer-term strategy and price outlook of the asset owner.
https://storage.pardot.com/131501/120574/Wood_Mackenzie_Volatility_and_value_the_supermajors_upstream_portfolios_at_differe.pdf
Exxon gets by on it's size. Other companies get by on innovation and great strategy. If this weren't true, Exxon wouldn't be trading like just another commodity company. We do fantastic when oil is high, good when oil is normal, and absolutely terrible when oil is low. A company reliant on good leadership wouldn't be so susceptible to low oil prices... but leadership will never learn because due to the size everyone will "forget" about the bad years when money starts coming in hand over fist when oil goes up. Don't expect the stock price to go up too much though
I think, I know the answer to your question. It is the “Overhead”, or above field cost. The cost of having all the people in Dallas and Springs, who have no affiliation to any production.
Sorry, if someone is hurt by my comment.
Ah yeah. We are a commodity company. Oil price increases our bottom line. No f—ing sh–.
Now why did we lose more money versus our peers to the tune of nearly $700 million. OPEX is not the culprit, neither is write downs. Something seems hidden in there.
But again, that has zero bearing in why we lost $680 million versus our peers.
If you follow Imperial Oil’s Earning Call from Friday:
Kearl’s production cost is $24/barrel. And, by the end of the year it is expected to be $20/barrel. And, further more, Kearl’s productions has gone above design capacity this quarter. Are you sure Kearl in the dead weight?
Don’t know about XTO USA, but XTO Canada is cash positive.
Reference:
https://www.imperialoil.ca/en-CA/Investors/Investor-relations/Speeches-and-presentations
XOM try to catch up with the rest.
We don’t write off assets even when they are clearly not worth their stated value- XTO is clear example. Therefore it was a radical statement when Earning call mentioned we are finally considering impairment on our dry gas assets. If we wrote off low value assets like everyone else in the industry, we would have below average balance sheet- and could no longer brag about our low gearing ratio.
Chevron is upstream and downstream. They do not have a chemical company to being money in anymore as they rolled that off. Both their upstream and downstream brought in money, we did not.
Kearl is a drain on the company in this low cost market, but not to the tune of 700 million. Not sure what XTO has anything to do aside from being a high value asset that isn't worth nearly as much. That did not go into this quarters cash flow.
The European IOCs have trading. Chevron doesn’t have Kearl or XTO as an anchor, so much less debt.
As the CFO said, crude price has to go up, otherwise more pain is coming. Listen to the analyst's call, all was discussed there.