Citing disappointing drilling results in two locales, ChevronTexaco Corp. slashed its U.S. natural gas reserves by 13 percent in 2004, the third year in a row in which it suffered a substantial reserves hit in the region.
Pointing to problems in the Gulf of Mexico and the U.S. Midcontinent, the San Ramon-based oil company cut its stated by 680 billion cubic feet, which equals 3 percent of the company's worldwide natural gas reserves, according to its annual report filed Thursday.
The company reported downgrades in 2002 and 2003 for similar reasons.
U.S. natural gas stood out as particularly poor as ChevronTexaco reported its worst performance in years when it came to replacing production.
ChevronTexaco, replaced only 18 percent of its production for 2004 and trimmed 6 percent of its overall resource base. However, ChevronTexaco rode high commodity prices to a record $13.3 billion in profits.
Shares in ChevronTexaco rose 52 cents, or 0.8 percent, to close Friday at $61.71 on the New York Stock Exchange.
Company shares have risen more than one-third
since January 2004.
Outside of the United States, ChevronTexaco's downward reserves revisions were generally unremarkable and were essentially offset by improved recovery performance elsewhere.
ChevronTexaco spokesman Don Campbell said the consecutive downgrades in the United States reflect the company's evolving understanding of the geology.
"We're giving out the most up-to-date information that we can," Campbell said.
Industry experts said ChevronTexaco's downgrades in the United States represent the sort of pattern that can sometimes raise questions at the Securities and Exchange Commission, which has been scrutinizing oil companies more closely following the January 2004 reserves downgrade by Royal Dutch/Shell Group.