Top Ten: Most Profitable Energy Companies
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10. General Electric
2011 1Q Profit: $3.43 billion
U.S. multinational conglomerate, General Electric (GE), has thrived since 1892 and was one of the first companies listed on the Dow Jones. GE features five segments: Energy, Technology Infrastructure, NBC Universal, Capital Finance, and Consumer & Industrial. The key to GE’s success is emphasis on individual performance within the company rather than teams or groups.
2011 1Q Profit: $3.5 billion
Formed in 2000 after a merger between energy companies VEBA and VIAG, German power company E.ON is the world’s largest investor-owned energy service provider. However, the company experienced a 23 percent slump in 1Q 2011 compared to last year, but this was due in large part to the sale of its British power network operator.
2011 1Q Profit: $5.86 billion
French multinational Total is among the oil companies boasting huge 1Q profits amidst sky-high oil prices. Turmoil in the Middle East has proven to be a blessing for oil multinationals, and Total’s 2011 1Q profits are 51 percent higher than 1Q 2010.
2011 1Q Estimated Profit: $6.2 billion
Petrobras is running late on reporting its 1Q earnings, but sources estimate a $6.2 billion profit for 1Q. Petrobras enjoyed a legal monopoly on oil production in Brazil until 1997, when private companies entered the market. Apparently this hasn’t hindered Petrobras’ profits too much, as the company consistently ranks amongst the highest profiteers in the energy industry.
6. Chevron Corp.
2011 1Q Profit: $6.2 billion
With an increase of $1.6 billion over 1Q 2010, Chevron CEO John Watson notes, "Current quarter earnings from upstream operations benefited from higher prices for crude oil, while downstream operations benefited from improved margins on refined petroleum products. We continue to operate safely, advance our major capital projects and restructure our downstream portfolio."
2010 3Q Profit: $6.9 billion
Malaysian state-owned Petronas oil and gas company’s most recent quarterly earnings report is for October through December 2010. Chances are Petronas ranks even higher now considering the oil price hike is not reflected in its 3Q earnings. However, when you’re the only oil and gas provider for an entire country, it’s easy to rake in huge profits.
4. Royal Dutch Shell
2011 1Q Profit: $6.9 billion
Shell is also raking in the profits this quarter, but is reinvesting $100 billion through 2014 in an effort to boost production to 3.7 million barrels per day. "We continue to make good progress in implementing our strategy; improving near-term performance, delivering a new wave of production growth, and maturing the next generation of growth options for shareholders," Shell CEO Peter Voser said.
2011 1Q Profit: $7.12 billion
No one expected BP to bounce back to number three after the oil spill disaster in 2010, but rising oil prices have come to the rescue. The company’s 1Q earnings are over $1 billion higher than reported in 1Q 2010, leaving some wondering if those profits should go to help the nearly 1 million people who lost jobs both directly and indirectly as a result of the BP spill.
2011 1Q Profit: $10.65 billion
ExxonMobil’s profits soared to 69 percent above last year’s 1Q. The company’s overall production rose 10 percent over 2010. “ExxonMobil’s earnings reflect continued leadership in operational performance during a period of strong commodity prices,” says CEO Rex Tillerson.
2011 4Q Profit: $11.2 billion
As the largest natural gas extractor in the world and Russia’s biggest company, government controlled Gazprom has ultimate authority over Russia’s energy sector. On a yearly basis, Gazprom produces roughly 500 billion cubic meters of natural gas.
Russian gas demand has steadily risen in 2011 by over 10 percent. Coupled with export demand increase around 28 percent, the company is expected to report huge 2011 1Q profits, that is if taxes don’t hit them first! The Russian government is seeking to boost revenue, and has Gazprom in its sights. The company could face $8 billion in taxes when an eminent tax increase and gas tariff rise is implemented.
But not to worry, Gazprom’s profits are likely to rise despite tax hikes, especially as the world seeks natural gas as a substitute for the oil shortcoming. “Not only are our volumes growing, but the growth rates are increasing as well,” says Gazprom CEO Alexei Miller.
Top 10 ways to prepare for COVID-19
Energy Digital sets out Gartner’s Top 10 ways organisations can prepare for a pandemic, via effective operational risk management.
As the spread of the Coronavirus (COVID-19) continues to develop, many businesses are left uncertain as to whether their risk mitigation plan is sufficient.
In a recent webinar conducted by the research and advisory firm just 12% of 1,500 people believe that their business is highly prepared for the impact of COVID-19, while 56% believed themselves to be somewhat prepared, and 11% believed themselves to be very unprepared.
“Most organizations have done some pandemic planning but still have many unanswered questions about whether they have done everything they can to manage risks,” says Jim Mello, Senior Director, Advisory, Gartner.
Establish a preparedness framework
Establish a team that represents all critical business functions. These people will report directly to executive management and are responsible for prioritising the importance of business activities and organise them in tiers for response and recovery.
Monitor the situation
It is important to ensure that organisations monitor the rate in which the infection is spreading and its severity. Many rely on the World Health Organisation for information.
Be sure to revise revenue forecasts and communicate with investors, as well as suppliers in regards to any potential finance issues. It is important to ensure that the business has the working capital to ride it out.
Ways to ensure this include: working capital checks, seeking loans or government-sponsored financial relief.
Extend personal hygiene and cleaning protocols
It is important to comply with any changes to workplace regulations. In addition, it is important to establish protocols for staff returning from infected areas, as well as extending existing hygiene activities.
Ensure close monitoring of absenteeism rates for signs of problems. It is important to identify critical staff in order to make sure the company can continue to function in their absence and be prepared for up to 40% absentee rates.
In addition to reviewing HR policies and procedures, it is important to maintain a level of sensitivity when it comes to engaging with employees and workplace preferences.
Establish a communication programme
People can feel out of the loop quickly. Establish a spokesperson appropriate for the situation who can maintain lines of communication. In addition, organisations should establish pre-approved messages and scripts for various stakeholders.
Review the impact on the operation
Although this may seem overwhelming, the team established to represent all critical business functions should identify key areas to consider. It is important to maintain a connection with the reality on the ground in countries affected.
Key questions to consider: is transport functioning? Have holidays been extended? Where can operation continue and where do they need to stop?
IT business functions tend to be relatively well-prepared for business continuity. However, it is important to assess the supply chain for critical equipment and keep extra inventory if required.
In addition, organisations should keep in mind remote data centre management and cloud options for critical systems as well as enabling remote working programs and rescheduling any non-essential IT work prioritising key applications.
Review pandemic plans to identify any gaps in response
Conduct a preparedness exercise by validating roles and responsibilities as well as recovery requirements and procedures, in order to identify any gaps in the recover capabilities and resource needs.
Following the establishment of a pandemic plan, identify three lessons learned, key observations or improvements for the exercise. After establishing these organisations should priorities the short and long term follow up actions.