Chevron Corp. (NYSE: CVX) said March 6 it expects 2018 production to be 4% to 7% higher than last year, excluding asset sales and on oil prices at $60 a barrel.
The company also revised its three-year annual capital spending plan to $18 billion to $20 billion, slightly lower at the midpoint than a previous estimate, and said it was looking to resume share buybacks.
Energy companies have been trying to increase production while minimizing costs as oil prices rise. Companies have largely been cutting expenses since crude prices collapsed in 2014.
High margin barrels of oil are expected to increase by more than 200 million barrels of oil equivalent per day (boe/d) in 2018, Chevron Vice President Jay Johnson said at an analyst day presentation.
Chevron expects Permian production of 500,000 boe/d by end of 2020 and 600,000 boe/d by 2022.
"We intend to grow free cash flow in 2018 and thereafter," CEO Michael Wirth said.
"Even with no commodity price appreciation, we expect to deliver stronger upstream cash margins and production growth," Wirth added.
The company, which had halted its buyback program in 2015 to conserve cash amid a slump in oil prices, did not give any additional details on the buyback, but said it will be in a place to start the program as it generates more cash.
Chevron's shares were up 0.84% at $114.10 in light premarket trading on March 6.
Devon Energy raised its full-year U.S. oil production forecast after posting a better-than-expected quarterly profit on the back higher output, especially in the Delaware Basin within the Permian.
Anadarko Petroleum, which is the target of a bidding war between Occidental Petroleum and Chevron, beat analysts' estimates for quarterly profit fueled by higher sales volume and lower costs.
Calgary, Alberta-based Encana now expects to deliver annual general and administrative savings of at least $150 million from the Newfield Exploration deal.