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Friday, October 31, 2025 at 11:00 a.m. ET Call participants Chairman and Chief Executive Officer — Michael K. Wirth Chief Financial Officer — Eimear P. Bonner Vice President, Investor Relations — Jake Spiering Need a quote from a Motley Fool analyst? Email [email protected] Worldwide Production -- Production exceeded 4 million barrels of oil equivalent per day in Q3 2025, driven by upstream growth and asset reliability. Adjusted Earnings -- Adjusted earnings were $3.6 billion, or $1.85 per share (adjusted), including special items totaling $235 million, such as severance and hedge-related costs, partially offset by the fair value measurement of Hess shares. Organic CapEx -- Organic CapEx was $4.4 billion, with expected full-year spending of $17 billion to $17.5 billion including Hess, in line with guidance. Adjusted Upstream Earnings -- Adjusted upstream earnings increased compared to the previous quarter, driven by higher liftings and a $150 million contribution from legacy Hess assets, partially offset by higher depreciation, depletion, and amortization (DD&A). Adjusted Downstream Earnings -- Increased due to higher refining volumes, improved chemical margins, and favorable operating expense timing. Cash Flow from Operations (Ex-Working Capital) -- $9.9 billion cash flow from operations, excluding working capital, representing a 20% increase compared to the same period last year even as crude prices were $10 lower than the prior year’s comparable period. Adjusted Free Cash Flow -- Adjusted free cash flow was $7 billion, including a $1 billion loan repayment from Tengizchevroil (TCO). Shareholder Returns -- $6 billion returned to shareholders, fully covered by adjusted free cash flow. Production Growth -- Up 690,000 barrels per day sequentially, primarily from legacy Hess production and strong execution in the Permian, Gulf of America, and TCO. Synergy Capture -- Approximately $1.5 billion in annual run rate savings achieved from restructuring, with further benefits expected in the next quarter. ACES Green Hydrogen Project -- Achieved first production in Utah, expanding the company’s renewables footprint. Ballymore Tieback Project -- Reached design capacity ahead of schedule, advancing toward more than 300,000 barrels per day capability in the Gulf of America. 2025 Production Guidance -- Full-year average production growth projected at the top end of the 6%-8% range, excluding legacy Hess assets. Operational Update: El Segundo Refinery -- Fire occurred in October with no serious injuries; supply commitments continue to be met while investigations are in progress. Permian Basin Production -- Surpassed 1 million barrels per day, currently 60,000 barrels per day above the targeted plateau, driven by productivity and efficiency gains with fewer rigs and completions. Hess Integration -- Realizing targeted synergies and integrating assets smoothly, with legacy Hess asset performance exceeding expectations. Equity Affiliate Distributions -- Outperformed guidance due to TCO results; Distributions are expected to decrease in the fourth quarter of 2025 as TCO undergoes planned maintenance and conserves cash for upcoming loan repayments. Chevron (CVX +3.39%) delivered record upstream production and robust operational execution, with major asset contributions from the Hess acquisition and substantial gains in the Permian, Gulf of America, and TCO. Technology deployment, portfolio restructuring, and realized synergies drove significant capital and operating efficiencies, while disciplined organic capital spending matched prior guidance and maintained favorable shareholder returns. The company executed key renewables milestones and reaffirmed capital allocation discipline amid changing macro and policy dynamics. Chairman and CEO Wirth described negotiations with Kazakhstan for an extension at TCO as complex and "just at the beginning," with future updates to occur only as progress warrants disclosure. Bonner confirmed the $1 billion synergy target following the Hess acquisition will reach run rate savings by year-end 2025, citing contributions from NOL utilizations, canceled put options, and operating efficiencies. Management noted that "new country entries" in exploration, including Namibia, Brazil, and Suriname, reflect a shift to more frontier opportunities, with capital allocation to expand beyond near-infrastructure focus. Eimear P. Bonner said, "Third-quarter oil equivalent production was up 690,000 barrels per day from last quarter, primarily due to legacy Hess production," highlighting the material impact of the transaction on results. The company’s portfolio weighting has returned to approximately 85% upstream and 15% downstream following the Hess acquisition, with long-term focus maintained on upstream returns and targeted downstream/petrochemicals growth. Operating model restructuring in upstream divisions has aligned organization by asset class, enabling more rapid transfer of technical best practices and leveraging technology for further efficiency gains. Chairman Wirth characterized the California refining market as structurally tightening due to policy-driven reductions in capacity and anticipated ongoing impact on supply chains and marine imports. Permian gas marketing strategy currently provides approximately 70% U.S. Gulf Coast pricing; Waha hub exposure fluctuates quarterly as the company leverages excess firm transportation capacity for additional value. Upcoming planned maintenance at TCO is expected to reduce affiliate distributions in the fourth quarter of 2025. Industry glossary Ballymore Tieback Project: A deepwater oil development in the Gulf of America connecting new production to existing infrastructure to accelerate time-to-market and lower costs. DD&A: Depreciation, depletion, and amortization, a non-cash expense reflecting the allocation of capitalized costs for assets over their useful life in oil and gas accounting. NOJV: Non-operated joint venture production, where Chevron holds an interest but does not serve as operator. NOLs: Net operating losses, tax attributes acquired with Hess and used to offset income for tax efficiency. TCO: Tengizchevroil, a Kazakhstan-based upstream joint venture, partially owned and operated by Chevron. ACES Green Hydrogen Project: An integrated clean hydrogen production facility in Utah, marking Chevron’s entry into commercial-scale green hydrogen output. Full Conference Call Transcript Michael K. Wirth: Okay. Thanks, Jake. In the third quarter, Chevron Corporation delivered record production and strong cash generation, supporting sustained shareholder distributions. The period was marked by several key milestones as we execute our plan for resilient and industry-leading free cash flow growth. Worldwide production exceeded 4 million barrels of oil equivalent per day, driven by strong growth and high reliability across the upstream. Hess integration is on track. Synergies are being realized, and asset performance has exceeded expectations. The Ballymore tieback project reached design capacity ahead of schedule, taking us another step closer to delivering over 300,000 barrels of oil equivalent per day in the Gulf of America. And we achieved first production at the ACES green hydrogen project in Utah. Earlier this month, the fire occurred at our El Segundo refinery. Importantly, there were no serious injuries, and we continue to meet our supply commitments. We are cooperating with all regulatory agencies and have our own investigation underway. Our top priority at Chevron Corporation is always the safety of our people and the communities we work with. Now I'll turn it over to Eimear to go over the financials. Eimear P. Bonner: Thanks, Mike. For the third quarter, Chevron Corporation reported earnings of $3.5 billion, or $1.82 per share. Adjusted earnings were $3.6 billion or $1.85 per share. Included in the quarter were special items totaling $235 million. These included severance and other hedge-related transaction costs and were partially offset by the fair value measurement of Hess shares held at the time of closing. Foreign currency effects increased earnings by $147 million. Organic CapEx was $4.4 billion for the quarter. We expect full-year organic CapEx, inclusive of Hess, to be $17 billion to $17.5 billion in line with guidance. Adjusted third-quarter earnings were up $575 million versus last quarter. Adjusted upstream earnings increased due to higher liftings and were partially offset by higher DD&A. Legacy Hess assets contributed $150 million in the quarter. Adjusted downstream earnings increased due to higher refining volumes, improved chemical margins, and favorable timing and OpEx results. Other segment earnings decreased due to higher interest expense, corporate charges, and unfavorable tax effects. Adjusted third-quarter earnings were down $900 million versus last year. Adjusted upstream earnings decreased due to lower liquids realizations and higher DD&A from increased production at TCO, the Gulf of America, and the Permian. The increase in OpEx and DD&A includes the impacts of the Hess acquisition. Adjusted downstream earnings were higher primarily due to improving refining margins. The other segment was down mainly due to higher interest expense and other corporate charges. These results include benefits from our structural cost savings program. Our new operating model is live, and we've captured approximately $1.5 billion in annual run rate savings so far and expect to see further benefits in the fourth quarter. Cash flow from operations, excluding working capital, was $9.9 billion in the quarter. This represents a 20% increase compared to the same quarter last year when crude prices were $10 higher. Adjusted free cash flow, which includes equity affiliate loans and asset sales, was $7 billion and included the first loan repayment from TCO of $1 billion. Cash returned to shareholders totaled $6 billion, which was more than covered by adjusted free cash flow. We expect strong cash generation to continue even in a lower price environment, underpinned by the increased capital efficiency and growth in high-margin assets. Third-quarter oil equivalent production was up 690,000 barrels per day from last quarter, primarily due to legacy Hess production. In addition, strong execution drove production growth in the Permian, the Gulf of America, and TCO. We expect full-year average production growth at the top end of our 6% to 8% guidance range, excluding legacy Hess. Back to Mike to wrap it up. Michael K. Wirth: Okay. Thanks, Eimear. Before we close, I'd like to say a few words of remembrance in honor of Chevron Corporation board member Dr. Alice Gast, who passed away earlier this week. In 1978, as a 20-year-old sophomore at Stanford, Alice served an internship at Chevron Corporation's Richmond refinery. She went on to earn her PhD in chemical engineering at Princeton. Her career came full circle thirty-four years later when she joined Chevron Corporation's board in 2012. Alice was an internationally known scholar and researcher who served as president of both Lehigh University and Imperial College London. She encouraged us to stay curious, value teamwork, and believe the best solutions come from listening to one another. Her legacy lives on in the questions we ask, the way we work together, and the respect we show one another. Lastly, I have a final reminder that we're holding our Investor Day on November 12. You can find details and instructions for the webcast on chevron.com. We look forward to sharing our outlook to 2030 and highlighting our diversified and resilient portfolio. You can expect to hear about a consistent, disciplined, and stronger Chevron Corporation. Hope you can join us. Over to you, Jake. Jake Spiering: That concludes our prepared remarks. Additional guidance can be found in the appendix of this presentation as well as the slides and other information posted on chevron.com. We are now ready to take your questions. Michael K. Wirth: We ask that you limit yourself to just one question. We will do our best to get all of your questions answered. Katie, please open the lines. Katie: Thank you. If you have a question at this time, please press 1 on your touch-tone telephone. If your question has been answered or you wish to remove yourself from the queue, please press 2. If you're listening on a speakerphone, please pick up the handset before pressing the numbers. We'll go first to Sam Margolin with Wells Fargo. Sam Margolin: Hi, good morning. Thanks for taking the question. Michael K. Wirth: Welcome back, Sam. Sam Margolin: No. Thank you. I expect, you know, we'll probably reserve kind of strategic and long-dated questions for the November day. So we'll stick to the quarter maybe in the Permian. You know, good production result there. Capital efficiency has been kind of an ongoing talking point and the distinction between co-op and NOJV acreage. Can you elaborate a little bit on what drove the Permian result and if you're seeing some better results in the field? Or if it's just part of a broader kind of industry trend of efficiency gains. Thanks. Michael K. Wirth: Yeah. So, look, we had a strong quarter. We're 60,000 barrels a day over the 1 million barrel where we said we'd kind of move towards a plateau. It really highlights the efficiency gain the team continues to deliver. We've got no change to our plans to moderate growth and focus on cash generation. We're focused on executing the program as efficiently as possible. Production is an outcome there. It'll move up and down. I, you know, I would expect, you know, we're gonna see some quarters where it's back down a little bit based on, you know, when we're popping wells. But we've been able to continue to deliver strong performance with fewer rigs, fewer completion spreads, a lot of progress on little things, including technology. And I think you'll hear more about this from Mark when we get together at Investor Day. So performance across the portfolio, co-op, NOJV, royalty has been strong. And we expect to move into 2026 with good momentum. Sam Margolin: Thanks, Sam. Katie: Thank you. We'll take our next question from Devin McDermott with Morgan Stanley. Devin McDermott: Hey, good morning. Thanks for taking my question. Mike, I wanted to ask you about Kazakhstan. You know, my understanding is you had the chance to meet with the president, alongside the UN, back in September. So I was wondering if you could give us a bit of an update on how some of the discussions around the concession extension are going, where we are in that process. Any broader color on the dialogue would be helpful. Michael K. Wirth: Yeah. So, you know, I did see the president in New York during the UN General Assembly. It's actually the second time that I've seen him this year. And we had a good conversation about where we are. It was grounded in the fact that TCO has created enormous value for all stakeholders over the last thirty-two years as a standalone entity. That has had strong partnership and performance with the Republic. Tengiz is performing well. You saw it this quarter. It's very visible in our results. It's bringing significant value both to shareholders of TCO and to the Republic. And, you know, we are off to what I would characterize as a good start to the negotiations. These are going to take some time. It's a complex contract. It's important to the republic. And it's important, obviously, to the shareholders. I wouldn't expect quarterly updates on this just due to the nature of the work. We've got technical teams engaged. We've got commercial teams engaged. And so the overall structure and governance and negotiations have been defined and they're beginning, but we really are just at the beginning. And so I'll update you from time to time as there is something more for us to say. Devin McDermott: Thanks, Devin. Katie: Thank you. We'll take our next question from Neil Mehta with Goldman Sachs. Neil Mehta: Yeah, just wanted your perspective on the Bakken asset. You've had this under your portfolio here, and Bruce portfolio for a couple of months now. And it seems you made some adjustments to the activity plan. So what are some initial observations, thoughts on whether this asset is core, and do you view it as part of a broader Rockies corridor that can compete for capital in the portfolio? Michael K. Wirth: Yeah. You know, we're excited to add the position to our shale and tight portfolio. Hess had a long-standing plan to grow it to 200,000 barrels of oil equivalent per day and to maintain that plateau for the foreseeable future. We're at that level now. We see some opportunities to continue to capture efficiencies from drilling cycle time improvements, the use of longer laterals. So similar to what we've described for the Permian, we're going to look to optimize capital efficiency, operating efficiency. We'll bring experiences from other parts of our portfolio to the Bakken. And just as we saw with Noble and PDC, I'm sure we will bring some best practices from Hess' Bakken operation to other parts of our portfolio. We're in no hurry to make a decision on the longer-term role in the portfolio. I've mentioned this before, so I won't belabor it. But, you know, we had underestimated the quality of the DJ and its ability to compete in our portfolio. And as we really got a good look at it, we were pleasantly surprised. So we want to be sure that we've applied all the things that we've developed in other areas to the Bakken. Take a look at how it will compete for capital. We've got the, you know, the midstream piece of it as well, which has to be factored into the thinking here. But we'll be thoughtful and thorough as we assess that and really focus on value, and we'll update you in due course as we reach any conclusions. Thanks, Neil. Katie: We'll take our next question from Ryan Todd with Piper Sandler. Ryan Todd: Thanks. Maybe a follow-up on that. I mean, overall, the Hess contribution came in at the high end of expectations or at least the guidance that you had provided earlier. Including very strong production. Can you maybe talk a little bit about what were some of the drivers of the strong performance and any other, you know, kind of key takeaways a little bit into the ownership there? Eimear P. Bonner: Yeah, Ryan. Good morning. It's Eimear. I'll take this one. Yeah. Strong production growth was really the main driver and then delivery of the synergies that we had expected. So, you know, both of those things are really contributing here to the stronger performance. Just maybe to double click a little bit on the synergies, we're moving at pace through integration. So this really applies not only to the back end part of the portfolio but the entire portfolio. We had a billion-dollar synergy target post-close, we confirmed that we will deliver that. We'll deliver those run rate savings this year. And so that is all on track, a combination of utilization of NOLs, put options that were canceled to close, and then operating efficiencies now that we've integrated the assets through into the Chevron Corporation system. We see this show up in the 3Q results and we, we'll expect to see more of that in the fourth quarter. Michael K. Wirth: Ryan, the one thing I might just add, you know, we did see the startup of Yellowtail in the quarter in FID for Hammerhead. I had a chance to sit down with the legacy Hess team that has been working in Guyana and go through it for an entire day. I gotta tell you, I was impressed with Guyana obviously, but I was really impressed and pleased with the quality of the people, and I have high expectations for the contributions that we're gonna get out of all the Hess employees that are part of Chevron Corporation now. It's the thing that doesn't get quantified or talked about as much in these kinds of calls. But in my experience, a huge amount of value when we combine with another organization is bringing in people that have different experiences can help us innovate and improve. And I have seen that again. So that's another real positive I just want to emphasize. Ryan Todd: Thank you, Ryan. Katie: We'll take our next question from Doug Leggate with Wolfe Research. Doug Leggate: Good morning, everyone. Thanks for having me on. Mike, I'm guessing you might touch on some of this in a couple of weeks. I'm not trying to front on you in any way, but I want to ask you about exploration. So you just made the point that you've hired or you've inherited a lot of people presumably Exploration Folks On Guyana from Hess, but you also just hired the ex-head of exploration from Total. You used to be the top explorer, you know, if you go back pre-sale 2010 through 2015. Spending a significant amount of capital in exploration. I'm just wondering as you think about shale maturity, not necessarily for you guys, but in the industry generally, what is your prognosis for exploration, the role of exploration, the associated spending that could fit in Chevron Corporation going forward, let's say, over the next phase of your development? Michael K. Wirth: Yeah. Thanks, Doug. You know, over the last several years, you're right. We constrained our exploration spending and we narrowed our focus into near infrastructure opportunities. We were adding a lot of resources and reserves in the unconventionals. And we're very serious about capital discipline. And so we made some trade-offs within the overall capital program. We now are at a point, I think, where we've characterized our unconventionals. It's a big and very attractive one. And we need to ramp up some of the exploration activity beyond just the focus on near-infrastructure opportunities. So we'll move to a more balanced approach of mature areas that are well known and also early entry into high-impact frontier areas. We've added a lot of new country entries over the last couple of years. In the South Atlantic margin, the Middle East, the West Coast of South America as well. So, we will look to have a broader program in some of those areas. Countries like Suriname, Brazil, Namibia, more opportunity in Nigeria and Angola where we like some of the prospects in Nevada. Both blocks and have been shooting seismic recently. So we're looking for more out of that. We've modified our internal organization as part of the overall restructuring that you've heard about, to simplify decision-making and speed it up. We're going to be bringing new technology to bear and have some really interesting things going on there. We've got some new people from Hess also now, Kevin joining us from Total. And our current head of exploration, Liz Swartzey, has reached the end of a long and very wonderful career. A natural time to move on to a new person. And often, we look both inside and outside the company. And I think Kevin brings some unique experience that we expect will be helpful as well. And so, we will talk about that more in a couple of weeks when we see you. But, you know, the short story is more emphasis on frontier exploration. I think you'll see a little more commitment of resources. So that would be both people and capital to that. Thanks, Doug. Katie: We'll take our next question from Biraj Borkhataria with RBC. Biraj Borkhataria: Hi, thanks for taking my question. Actually, it's just another follow-up on the exploration front. It has been notable the new country entries. The one that caught my eye was in Namibia. I believe you're planning a 10-well campaign there. Doesn't seem like your first well has sort of put you off the basin. So yep. Of questions related to that. Could you give us your updated thoughts on the prospectivity of the basin? And secondly, whether you feel like you have enough exposure through the exploration campaign or whether you'd be looking to add more from any inorganic opportunities that might arise? Thank you. Michael K. Wirth: Yeah. So, look. We've got a portfolio of opportunities that's been identified from seismic on our blocks. We've drilled one well that didn't yield commercial hydrocarbons, but it was very well executed and a lot of valuable information from that we're using to evaluate options to drill some other blocks on these licenses. We recently completed a farm-in on a couple of other blocks in the Walvis Basin, and we've got an opportunity to apply some play concepts from the Orange Basin into the Walvis with a well that we'll drill in 2026 or 2027. So, you know, that's an area that, obviously, there's been a lot of interest in. Folks have had some success. We had success there a long time ago with the Kudu gas discovery, which is several decades back. And, you know, we remain optimistic. It's exploration. And so you've gotta do the work to see what you find. The 10 wells you referred to, we've got an environmental permit that would allow us to go up to 10. I don't I would interpret that as a plan to actually go to that number unless we see things that would suggest that's the right thing to do. In terms of the inorganic, you know, we don't really comment on commercial activity or discussions, but we always look at everything to make sure we got a good understanding of the market and as I mentioned, we've actually farmed into some things and, you know, you'll continue to see, I think, us optimize our portfolio in Namibia as well as other locations. Thanks, Biraj. Katie: Thank you. We'll go next to Paul Cheng with Scotiabank. Paul Cheng: Good morning. May I just when I look at your result over the past year or two, your base operation has done really well. I just curious that have you changed the way that how you manage your base? And so does that become repeatable? And, honestly, that and it's not just you, but that the rest of the industry also seems to be doing better. So should we assume going forward, the underlying base decline is going to be far more modest? For you, I think it's about 3%. So is that on the ballpark, we should assume or that could even be lower in the future for you? Thank you. Michael K. Wirth: Yeah. Thanks, Paul. I appreciate you paying attention to our base operations around the world. There's probably a couple of things I would point to for us, and I can't necessarily comment on others. Number one, we are focused on doing all the little things right. The restructuring of the company that's underway has created in the upstream an organization now that is aligned around asset classes primarily. So offshore, unconventional, we do have a couple of big assets that are reporting uniquely in places like Australia and Kazakhstan. But we're aligned in a way now to drive best practices and technology more effectively across those operations. And as we improve in one place, we should see those improvements show up in other places more quickly. We are applying a lot of technology. And we'll talk about this a little bit more in a couple of weeks. But the information technology that allows us to automate things and make decisions faster. Stay on top of things, I think is going to yield further results but we're already seeing the early returns on that. The other thing that I would just remind you of is we have a portfolio, Paul, that as compared to, say, a decade ago for sure, but you can look at different time periods. We have a lot more of our production now that is in either a facility-limited position. Think of TCO or think of Gorgon and Wheatstone. As, you know, fields that could deliver more, but the facilities limit that. So you essentially don't see decline there. Because those are very plateaued at low capital. And increasingly, you know, Permian, DJ, Bakken, we have unconventionals that are being managed that way as well. And so at much more efficient capital, and you're seeing that in the Permian right now, the production for the basin can hold flat in a very capital-efficient manner. Now each well has, you know, new wells have that peaky production profile, but in aggregate, as you go from hundreds and hundreds into thousands and thousands of those wells that are in that kind of longer flatter portion of their life. They also have kind of shallow decline that you can offset with this capital-efficient program. So the point I'm making, and sorry for going on, is it's a combination, I think, of portfolio effects which yield less capital-intensive work to hold production. And assets that have facility limits on them. And those combine to give us the attributes that you're observing. And that is intentional. That's not an accident. It's a portfolio that's been designed to do that so we don't face the massive capital investment to offset big decline and are faced with that year after year after year. Paul Cheng: Thank you, Paul. Katie: We'll take our next question from Stephen Richardson with Evercore ISI. Stephen Richardson: Morning. Thank you. Mike, I'd love your perspective on the California refining market. We've got a couple of pretty notable shutdowns in process, and some proposed pipeline projects to bring products to the West Coast and obviously, more waterborne imports. So would love to hear your perspective on that, the policy backdrop, and where this leaves your business in the state. Michael K. Wirth: Yeah. So, you know, the two recent, you know, I guess, one that's underway right now and one that is set to close in 2026. Again, a lot of attention. Remember, there's a couple of other facilities that have been converted from petroleum-based feedstock to biofeedstocks. With much lower overall production capacity. So you've seen a market where supply has tightened. It is a function of policy, pure and simple. Others, you know, have spoken to that as they've made changes either in the way a refiner is being used or announced plans to close it. And so the policy is yielding the desired results, I think you're seeing some discussion now where policy is being reconsidered, and there may be some small steps in the right direction we've seen. But nothing that I would say is significant. The other thing that is underway is, you know, people have to think about how do they get product to the state now because it is not going to be balanced to long. It is going to be balanced to short. And so marine imports are gonna have to become a more regular feature. People are gonna have to figure out how to do that. This, you know, the recent talk about pipelines is interesting. California doesn't have inbound product pipelines or crude pipelines for that matter. These are interesting announcements. They're ambitious projects. There are many moving parts. These are complicated to permit. They're complicated to build. But I think fuel suppliers are looking for ways to meet the demand. One thing I think, you know, is a bearish thing about is the supply is gonna come from somewhere. So to the extent California starts to pull product from other markets, that has other knock-on effects as well. And so we'll see if these projects get built. We'll see how the market dynamics play out. But it's clearly a changing market. We've got a strong refining and marketing presence there. And to this point, you know, can compete and deliver acceptable returns. But that's something that will continue to be tested. And the policy moves by the state will have an impact on the decisions that get made by us and I suspect by others. Thanks, Steve. Katie: We'll take our next question from Jean Ann Salisbury with Bank of America. Jean Ann Salisbury: Hi, good morning. This was true before Hess, but now more so. Chevron Corporation's portfolio is more weighted towards upstream than many of your integrated peers. Are you happy with that mix, or is that something that you might seek ideally to even out over time with more downstream or chem's exposure? Michael K. Wirth: Yeah. Jean Ann, our portfolio post-Hess is back to kind of 85% upstream, 15% downstream. And that's kind of where we've been over the last couple of decades. And so I don't think, you know, we don't feel compelled to try to weight it up in the downstream further than that. You know, over the cycle and I came out of the downstream. I love the downstream business. I got a lot of affinity for it. But, you know, upstream is a declining depletion business. Downstream is a business of capacity creep in facilities that often get bigger over time. Not smaller, and it's hard to close refineries down. We've seen some rationalization over the last five years as COVID and some other market imbalances kind of drove that. But historically, and I think going forward, we're still of a view that downstream returns over time are gonna be more pressured than upstream returns, which tend to be a little more self-correcting. The one piece of the downstream we've been clear that we would like to grow is petrochemicals. We got a couple of projects underway at CPChem right now. Tough market conditions in that sector. But over the long term, we'd like the, you know, the demand growth and economic opportunities in petrochemicals. But, you know, I think you should expect to see us stay with a portfolio weighting that's not too different than where we are today. Thanks. Katie: Thank you. We'll take our next question from Jason Gabelman with TD Cowen. Jason Gabelman: Yeah. Hey, morning. Thanks for taking my question. It looks like equity affiliate distributions have been running much higher than guide year to date. I think every quarter, it's beat guide this year by about $700 million. Wondering what's driving that beat? Is it TCO outperformance? Is it higher LNG prices? And should we expect that to continue into 4Q and next year? Thanks. Eimear P. Bonner: Hi, Jason. I'll cover that. Yeah. I mean, the affiliate dividends performance has really exceeded when it comes down to TCO's performance. Since starting up earlier in the year. They've operated safely and reliably. And, you know, the results just speak for themselves. So, you know, it is really a TCO story. When we look at the guidance, though, I mean, no change to the guidance with that high performance. Given that in the fourth quarter, we've got a stop plan for TCOs, so you'll see production come off in the fourth quarter due to that pit stop. And so, you know, they also, TCO, have to conserve some cash because they've got two loan repayments to make next year, one in the first quarter and one in the third quarter. So, you know, those two factors are really driving the change in guidance that we've provided that, you know, on the surface, looks like it's coming down, but, really, it's being driven by those two things. Jason Gabelman: Thanks. Jason. Katie: Thank you. We'll take our next question from Arun Jayaram with JPMorgan. Arun Jayaram: Yeah. Just a quick follow-up on TCO. That was a driver of the earnings beat this morning. Your production on the liquid side grew 5% sequentially. Notwithstanding the turnaround in the fourth quarter. But are you essentially ramped to capacity there? Michael K. Wirth: Yeah. You know, we're really pleased with how TCO has been performing. We had another quarter of very reliable production, and I want to emphasize reliability. Starting up a new complex set of processing trains like we did there, historically, can offer some reliability challenges. And this one has been, touch wood, exceptionally smooth. So we're pleased with that. We didn't have any planned maintenance here in the third quarter, and so you see things running, yeah, very much at a planned nameplate. We continue to also, you know, one of the things that Mark mentioned when he was on the call last time is we now have three generations of surface plants to process both the liquids and the gas. The original complex technology line area of the facility, which goes way back, the second generation plant, which was started up last decade, and now the third generation plant, which is this decade. We have an integrated control center that can route streams optimally across all three of these facilities. We're using a lot of high-end information technology to automate this to a greater degree. And so we've got more knobs to turn and levers to pull to really optimize plant performance. And we've got a field now that's producing with less back pressure, and so we're seeing all of that come through. You know, the history on these great big complex facilities, a little bit like I mentioned about refineries, we do find ways to create capacity and debottleneck them over time. It's premature to reset any guidance on that, but the history suggests that there's an opportunity there. And certainly, those are the kinds of things that our people are working on. The fourth quarter will reflect the pit stop that Eimear mentioned, but, you know, we'll be working on that and update you more about it over time as we see how things perform. Katie: Thank you. We'll go next to Phillip Jungwirth with BMO. Phillip Jungwirth: Thanks. Good morning. One of the big US upstream themes has been getting more value for Permian gas. There's been a number of pipelines announced FID. I know Chevron Corporation's already well relatively well positioned here, but given that you produce, I think, two Bs a day net from the Permian, just hoping you could talk about what you're already doing on the marketing side here and also what you think you can do in the future to further maximize value. Michael K. Wirth: Yeah. Thanks, Phil. I know this has been getting some attention recently. In the Permian, we market all of our company-operated production. So that would be oil, NGLs, and gas. And just a little less than half of the NOJV production. So you can think about it in total that kind of call it 70%, or so of our production gets US Gulf Coast pricing. The remaining portion of NOJV and royalty volumes that we don't market can be exposed to in-basin pricing and Waha pricing on gas. So our Waha exposure can vary a little bit each quarter. Last quarter, it was a little closer to 20% rather than the 30 that would be implied by what I just told you because we were able to use some of our own excess firm transportation capacity out of the basin to capture value from others that didn't have an opportunity to move out of the basin. So we can capture some of the arb that opens up from time to time there to offset some portion of that volume that we don't actually market ourselves. Going forward, I think you should look for us to do more of the same. We're covered on all three streams right now for out-of-basin transportation. To the extent we're long, sometimes we can use that to capture additional value. And we tend to, because we're running a very steady well-planned program, we can commit in advance because we got a high degree of confidence on the composition of the production and the volumes that we're going to need. Obviously, for shippers, we're a desired shipper given the credit quality and reliability that we offer to them. And so we'll continue to use that to ensure that we're well covered and that we can optimize value across the entire value chain. Phillip Jungwirth: Thank you. We'll take our next question from Lucas Herrmann with BNP. Lucas Herrmann: Yeah, Mike. Thanks very much. I just wanted to briefly go back to the downstream and chemicals. And as you mentioned, I mean, you've got two very large facilities coming on stream with Qatar Energy next year. And the question simply, as they come on or as they build to capacity, what's the increment at current levels that you'd expect from, for cash flow, and to what extent a little bit like TCO, can one expect to see, you know, CapEx across CPChem fall and distributions to, you know, to the center to yourselves increase. That's it. Thanks very much. Michael K. Wirth: Yeah. Phil, you know, we'll talk about this a little bit more at Investor Day. Two things I would just point out. You know, these are world-scale facilities. They have very advantaged feedstock positions, and they will be very low on the cost curve. And so they're highly competitive facilities that will be coming into the market. At the margin, some of the length in the market tends to be in countries where they're cracking naphtha. They tend not to be world-scale facilities and they're feeling a lot of economic pressure right now. So we think both of these projects are well-positioned to deliver returns over the long term. They're kind of 20% type IRR expectations on these projects. We're very pleased with our relationship with QE. Chevron Corporation's exposure, you know, comes through a joint venture in CPChem then a further venture with QE. So you have to think about that as you think about how exposed we are and how much cash those might generate because it flows back through the dividend policy at CPChem. And we're only exposed to a portion of each of those facilities. More to follow at Investor Day on that subject. Thanks. Katie: We'll take our next question from Paul Sankey with Sankey Research. Paul Sankey: Good morning, everyone. Mike, you know, I know you can't talk obviously about the specifics of the analyst meeting, but I wanted to ask you a quest for you to set the table a bit here in terms of the macro environment. And the reason I'm asking is just that this analyst meeting is gonna be your first since 2023. Which is the longest, you know, gap that you've had between meetings, as far as back as I know. So, you know, given the world, I just wanted to get your perspective on how the world has changed and perhaps some of it cyclical, some of it structural. As we go into this meeting. And to answer the question, a little bit and help you out here with what I'm thinking, I mean, you've got the continued war in Russia since 2023 Russia Ukraine. There's a massive shift in ESG that we've seen since then. The AI boom, completely new. OPEC policy, I think, has changed. And, of course, the big one is the second Trump administration, and then finally, the interest rate environment. I guess, has changed. I just like you to, kinda set the stage if you want. Thanks. Michael K. Wirth: Alright. Well, Paul, what you've done is you've kind of teed up the answer I give to people when they say, isn't this kind of yesterday's business and there's not a lot going on in it? I mean, the world changes constantly. And in, you know, two and a half or two years and, you know, eight months, whatever it will have been since our last meeting, a lot has changed. The war in Russia had only begun or the war in Ukraine. The Middle East hadn't seen hostility breakout. We hadn't seen Iran hit the way that it now has been. You're right. We were kind of at peak ESG, at our last meeting. There was not much interest in AI at the time or not much public acknowledgment of what was probably going on behind the scenes there. OPEC was responding, I guess, at that point in time. You know, still we've been in a high-price market due to the start of the conflict in Ukraine. But, you know, before long, they started constraining. And we've had President Biden in the US, not President Trump. So, you know, we always have a changing context in this industry. The last few years might have had a little more interesting change than most. But the fundamentals really are what we try to look through and, you know, the global economy continues to grow. The population of the planet continues to grow. Economic development continues to advance. And affordable and reliable energy is fundamental to that progress. And I think the conflict in Ukraine has pointed that out, what we're seeing with AI and the stress on the power system in the US is pointing that out. And so affordable, reliable energy is the lifeblood of a modern economy. That's the business that we're in and the fundamentals of that we continue to believe offer value-creating opportunities for wise capital investment long, long into the future. So we'll talk about that. We'll give you some guidance on our business, you know, out to the end of the decade. Right now, I think most of our guidance goes to the end of next year. I think one thing I would say, Paul, is you should expect us to be consistent. In what you're gonna hear from us. Our strategy has stood the test of time over a pretty volatile period as you just described. And we know you're interested in cash and earnings growth through the decade. What we'll also talk about is how we'll deliver that, through continued capital and cost discipline, through innovation, through technology, through a very strong portfolio, through one that is as low risk and high confidence as I've seen in my career. And is set up to continue to reward our shareholders with continued strong cash returns through the dividend policy where we have been a leader and through a steady through the cycle share repurchase program where I think we've been very predictable and consistent. So, that maybe says no huge surprises. But it does say that a good story is continuing to get better. Paul Sankey: Thanks, Paul. Katie: We'll take our next question from Bob Brackett with Bernstein Research. Bob Brackett: Good morning. There's a view out in the macro market for oil that the market's oversupplied in '26 and that shale has to make some room for OPEC's spare capacity. You all touch more barrels in the Permian than anyone through your operated your non-op JVs and your royalties. What's the state of the Permian today, and would you forecast that, say, into next year? Michael K. Wirth: Yeah. I mean, you know, the current rig count is somewhere in the neighborhood of 250 rigs, I think. That is at or at least close to multiyear lows. You know, I think most third parties seem to think that level of rigs is an appropriate number to maintain current production levels. And that's, of course, dependent upon, you know, are they still finding good productive opportunities beyond the top-tier acreage? Our company is still able to deliver cash back to shareholders which is a promise that I think we've seen a lot of the Permian operators now commit to that, that may be tested as we go through a period of lower prices. And see if how they handle the trade-off between capital and cash returns to shareholders. We continue to see efficiency and productivity gains in our fleet. I think others are probably seeing similar kinds of gains. And we continue to work on technology and things that will improve not only the ability to execute well but the ability to recover more. So, you know, most companies seem to be guiding to kind of flattish or maybe slightly reduced CapEx, as we go forward, I would say that's probably not a bad proxy for where production is likely to go. So not growing at the rate that we've seen before, probably plateauing. But, you know, as and all of you that have watched the Permian over the last fifteen or twenty years have seen these things change. And it's a dynamic basin. It's a highly responsive basin with a lot of players in it. And it can be quite responsive to market signals. Bob Brackett: Thank you, Bob. Katie: We'll take our next question from Geoff Jay with Daniel Energy Partners. Geoff Jay: Hi. My question is on Argentina. I noticed that you had a pretty a reasonably high percentage uptick in this quarter. And, you know, given that you I think you have roughly the same amount of acres there as you do in the DJ. I'm kinda curious as to, you know, how well you think the potential of Argentina production could be over the next two or three years? And, you know, what are the key gating factors to that growth? Michael K. Wirth: Yeah. Well, let me start by just reminding everybody that we went in Argentina for many years. We've been in vertical production through some acquisitions that go back decades. And it's been a place where we've a lot of history. We understand the subsurface. We really like the quality of the subsurface and our position in the Vaca Muerta both in the South at Loma Campana where we're a partner with YPF and up north at El Trapial where we operate ourselves. I'll also say it was encouraging to see the support for President Malay in the recent election. We've been pleased with some of the macro posts in Argentina that have improved since the current administration took office in 2023. Efforts to stabilize the banking system to reduce or remove capital controls, lower inflation, invest in regional infrastructure. Those are the types of policy reforms that can make Argentina more attractive for investment and more competitive within our portfolio. We don't really have a change in our near-term plans. We want to continue to see some of these signposts evolve. But we like the quality of the rock. We have seen some modest growth this year with kind of 25,000 barrels a day expected in 2025. We're taking lessons and talent and technology from these other basins to Argentina to approve outcomes. And with continued progress in the policy arena, you know, this could compete for capital very effectively as we go forward. We certainly hope that it does. There's a lot of running room. I'm not gonna quantify it. But it's certainly got upside because it's got scale as you say, and the quality of the rock is highly competitive. So the DJ might not be a bad analog, but, you know, we're gonna be one step at a time. Thank you. Thanks, Geoff. Katie: We'll take our next question from James West with Melius Research. James West: Hey, good morning guys. Question on the Permian for you. Curious, as other operators are dropping CapEx, dropping rigs, dropping frac spreads, you guys recently hit a million barrels a day. You're having a lot of success there. What's the differentiator on your operation versus, say, the smaller peers? Michael K. Wirth: Yeah. Well, welcome, James. You know, it's nice to hear your voice, and we look forward to seeing you in New York in a couple of weeks. Look, you know, we operate on a long-term plan. We've got a factory or a manufacturing type approach to developing this asset. We plan our work and work the plan. We don't whipsaw it much on near-term commodity market dynamics. Smaller operators that may be not in the same balance sheet position, may not have a diversified portfolio, may have other financial constraints, can operate, you know, may operate differently. We just find that a continued steady, consistent manufacturing approach allows us to pilot and trial new techniques, new technologies, continue to improve, and we just grind out better efficiency and productivity each and every day. And so we're 40% more productive on drilling wells than we were just a few years ago. The same thing on completions. And I think the scale and the steady approach to development yields the steady improvement. And I think smaller companies just don't quite have the same ability to do that without having to reset the program. But look, you know, I'll comment quickly on our NOJV. We partner with some of the largest operators in the basin. And we're not seeing a lot of change in activity levels there at this point. Their activities remained aligned with our business plan. We've got a very good line of sight on the 2025 performance through the balance of the year. And pretty good line of sight on 2026 production where we've got plans that have we got visibility of wells that are either online or under construction. Today, AFEs that are already being processed for 2026. And so at least relative to our performance, there are not signs that we would see the NOJV piece of our business significantly constrained or contracting as we go through next year. Thanks, James. Jake Spiering: I would like to thank everyone for your time today. We appreciate your interest in Chevron Corporation and your participation on today's call, and we look forward to seeing you in a few weeks. Please stay safe and healthy. Katie, back to you. Katie: Thank you. This concludes Chevron Corporation's third quarter 2025 earnings conference call. You may now disconnect.
