Oil production increased 4 percent, driven by growth from the Permian Basin, the top U.S. shale field underlying western Texas and southeastern New Mexico. Natural gas production was down as Exxon shifts away from producing the fossil fuel in the U.S.
Analysts were closely watching Exxon’s headline oil and natural gas output. The Irving, Texas-based company has regularly reported lower hydrocarbon production over the last two years.
Profits in the upstream business, which explores for and produces oil and gas, jumped 47 percent to $3.7 billion last quarter, excluding U.S. tax impacts.
On Thursday, the oil major announced it will restructure its upstream business, consolidating operations across three companies in order to achieve its goal of doubling operating cash flow and earnings by 2025.
Profits in Exxon’s downstream business refining and selling fuels nearly tripled to $2.73 billion, also excluding U.S. tax impacts.
Exxon’s downstream business refining and selling fuels have also been on the Street’s radar. Heavy maintenance at refineries has weighed on profits in the segment. Exxon has warned of further downtime as it retools facilities to process low-sulfur fuels ahead of tighter emissions standards in the maritime shipping industry.
On Friday, the company said downtime and maintenance fell in the U.S. but was higher at international facilities. Executives said they expect a similar level of maintenance activity in the first quarter of 2019. Higher profit margins in the U.S. and gains from divesting in international assets offset the impacts from downtime.
Earlier in the week, Exxon announced a final decision to expand its Beaumont, Texas, refinery to process a surge of production from shale fields in the Permian Basin. The build-out will make the Beaumont facility the second largest in the United States after Saudi Aramco’s Motiva refinery in Port Arthur, Texas.
Exxon’s third major business line, producing chemicals, also suffered from downtime. Lower profit margins and investments to grow the segment further weighed on the bottom line. Profits at the chemicals unit fell 20 percent to $744 million.