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Chevron Fills Critical Information Gap With Community Website

It appears that Chevron, flush with a record second quarter profit of $4.4 billion ($33,577 per minute) is going to drop a little on the people of Richmond by providing a remarkable service, hosting a website http://www.richmond-today.com, that, according to Chevron, “…is designed to provide Richmond residents with a one-stop online resource for community news and information they can use and enjoy.”

The website is a welcome addition for information-starved Richmonders who search relentlessly and fruitlessly on such inadequate existing sites as Point Richmond Gazette, Point Richmond.com or the City of Richmond “Greensheet” for information about community events. You can even peruse copies of news stories about Richmond only 10 days old from the West County Times and http://www.sfgate.com/chronicle.

I didn’t see any reprints from The Globe, the Truth Tazer, the Berkeley Daily Planet or the Tom Butt E-Forum, but perhaps they will be added later.

I don’t suppose the upcoming Richmond elections had anything to do with this. The website notes that Chevron “… reserves the right from time to time to use the web site to express opinions on important public policy issues concerning the refinery and the community.” You might check the website from time to time for news on the new container port in Wildcat Marsh.

Chevron quarterly profit: $4.4 billion
Falling below Wall Street's expectations, San Ramon oil company posts record results that spur outcry from consumer advocates

- David R. Baker, Chronicle Staff Writer
Saturday, July 29, 2006

Chevron Corp. reported Friday a record $4.4 billion profit in its most recent quarter, a 19 percent jump propelled by high oil prices and strong margins at the company's gasoline refineries in the United States.

That profit, equaling $1.97 per share, prompted renewed complaints of price-gouging from politicians and consumer advocates. At the same time though, Wall Street deemed Chevron's results insufficient, pushing down the company's stock. Every other oil giant that reported profits this week -- including Exxon Mobil Corp., BP Plc and Royal Dutch Shell Plc -- made more.

San Ramon's Chevron brought in $53.5 billion in revenue during the three months ending June 30, a $5.2 billion increase from the same period last year. So far this year, Chevron has made $8.3 billion in profit, placing the company on track to top its $14.1 billion annual record, set last year.

Roughly 75 percent of Chevron's profit in the most recent quarter came from finding and pumping crude oil. Crude prices have been stuck near or above $70 per barrel for months, the result of strong global demand, speculative investors pouring money into the market, and fears that conflict in the Middle East and Africa could disrupt supplies.

About 12 percent of Chevron's quarterly profit came from refining and marketing operations in the United States, where regular unleaded gas prices now average $3 per gallon.

Chevron, like other oil companies, does not reveal exact profit margins for its gasoline refineries. But the company's earnings release noted that the margin for gasoline refined on the West Coast by all companies rose about 58.6 percent between the first and second quarters of this year to $29.06 per barrel. Compared to the second quarter of 2005, the margin rose about 39.6 percent.

The margin Chevron reports represents the price difference between Alaska North Slope crude oil, widely used in California refineries, and the price of the gasoline refiners sell. The figure does not include many costs.

The jump in refinery margins occurred because the price of gasoline rose faster than the cost of crude oil in the second quarter.

That drew the attention of California officials examining the state's gasoline market. In April, Attorney General Bill Lockyer opened an investigation into refinery profit margins while California experienced a sudden gas price spike that economists were unable to easily explain. Chevron controls about 25 percent of the state's refining capacity.

"The numbers provide further evidence of the need for the investigation the attorney general launched earlier this year," said Lockyer spokesman Tom Dresslar. "We need to get some answers about the steadily increasing margins that California refiners enjoy."

Judy Dugan, research director for the Foundation for Taxpayer and Consumer Rights, saw the refinery margins as evidence of gouging.

"There is no reason, aside from greed, for them to be making this kind of money on the backs of California motorists," she said.

Chevron maintains that the prices it receives, both for crude oil and refined gasoline, are set by the market.

"While we empathize with consumers who are feeling the pinch from high prices at the pump, any suggestions that we manipulate the California market to drive up prices are absolutely false," said Chevron spokesman Don Campbell.

Sen. Dianne Feinstein, D-Calif., called the oil company profits reported this week "unconscionable" and said the government should eliminate the industry's subsidies and incentives.

"The time has come to shine some light on the oil industry," she said, in an e-mailed statement.

Although Chevron's profits set a record, they underwhelmed investors. Wall Street analysts polled by Thomson Financial had expected earnings per share of $2.21.

Chevron's stock dropped $1.68, or 2.48 percent, to hit $66.05.

"On the whole, their performance was a little weaker than their peers," said Edward Jones oil analyst Lanny Pendill.

Earlier in the week Exxon Mobil reported a $10.4 billion profit for the second quarter. BP made $7.27 billion, while Shell scored $7.32 billion.

Pendill was pleased to see Chevron's refining margins improve, saying that used to be a weak spot for the company. Other analysts said Chevron appears to be on the right track, even if the company's results missed expectations.

"They're not making birdies out there, but they're not making bogeys," said analyst Justin Perucki, with the Morningstar research company. "Oil prices are still high, refining margins are through the roof, and they're still making money."

CHART (1):

E-mail David R. Baker at dbaker@sfchronicle.com.

Rising oil income 
    Major oil companies 
this week reported large increases in quarterly profit over the same period 
last year. 
    Quarterly profit of selected oil companies 
    In billions of dollars 
    Company           Profit  Increase 
    ConocoPhillips       5.2  65% 
    Royal Dutch Shell    7.3  40% 
    Exxon Mobil         10.4  36% 
    BP                   7.3  30% 
    Chevron              4.4  18% 
    Source: The companies 
    Associated Press

CHART (2): 
   CHEVRON CORP. (San Ramon) 
   2nd Quarter              
				2006              2005 
   Revenue           $53,536,000,000   $48,343,000,000 
   Net profit         $4,353,000,000    $3,684,000,000 
   Share earnings              $1.97             $1.76