Chevron Corporation

Good morning, my name is Jen and I will be your conference facilitator today. Welcome to Chevron's fourth quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session and instructions will be given at that time. If anyone should require assistance during the conference call, please press star and then zero on your touchstone telephone. As a reminder, this conference call is being recorded. I will now turn the conference call over to the General Manager of Investor Relations of Chevron Corporation, Mr. Roderick Green. Please go ahead.

Thank you, Jen. Welcome to Chevron's fourth quarter 2021 earnings conference call and webcast. I'm Roderick Green, GM of Investor Relations. Our Chairman and CEO Mike Wirth and CFO Pierre Berber are on the call with me. We will refer to the slides and prepared remarks that are available on Chevron's website. Before we begin, Please be reminded that this presentation contains estimates, projections, and other forward-looking statements. Please review the cautionary statement on slide two. Now, I will turn it over to Mike.

Thanks, Roderick. After the challenges of 2020, we began last year clear-eyed about the economic realities we faced, and at the same time optimistic about an eventual recovery. By the end of 2021, we had one of our most successful years ever. With return on capital employed approaching 10%, our highest since 2014, the successful integration of mobile energy, while more than doubling initial synergy estimates, and record free cash flow, 25% greater than our previous high. 2021 was also the year when Chevron accelerated our efforts to advance a lower carbon future by forming Chevron New Energies, an organization that aims to grow businesses in hydrogen, carbon capture, and offsets. introducing a 2050 net zero aspiration for upstream Scope 1 and 2 emissions, and establishing a portfolio carbon intensity target that includes Scope 3 emissions, and more than tripling our planned lower carbon investments. Chevron is an even better company today than we were just a few years ago. We're showing it through our actions and our performance, which we expect to drive higher returns and lower carbon, and we intend to keep getting better. Our record-free cash flow enabled us to strongly address all four of our financial priorities in 2021. A higher dividend for the 34th consecutive year, a disciplined capital program well below budget, significant debt pay down with a year-end net debt ratio comfortably below 20%, and another year of share buybacks, our 14th out of the past 18 years. I expect 2022 will be even better for cash returns to shareholders. with another dividend increase announced this week and first quarter buybacks projected at the top of our guidance range. We're optimistic about the future, focused on continuing to reward our shareholders while investing to grow our businesses and maintaining a strong balance sheet. We made the most of this challenging period, transforming Chevron through a well-timed acquisition and an enterprise-wide restructuring into a leaner and more productive company. In just two years, CapEx was reduced by almost half from Chevron and Noble's pre-COVID total. And operating expenses for the combined company in 2021 were lower than for Chevron on a standalone basis in 2019. The Noble acquisition and increasing capital efficiency enabled us to maintain a five-year reserve replacement ratio above 100%. And 2021 was very consistent with that longer-term performance. driven primarily by additions in the Permian, Gulf of Mexico, and Australia, and partly offset by lower reserves in Kazakhstan, mostly due to higher prices and their negative effect on our share of reserves. For more on our strong financial performance, over to Pierre.