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Exxon Mobil profits, sales soar; Royal Dutch Shell not far behind Oil companys 3rd-quarter earnings prompt tax request Steve Quinn THE ASSOCIATED PRESS DALLAS — Exxon Mobil Corp. rewrote the corporate record books Thursday as the oil company’s third-quarter earnings soared to almost $10 billion and it became the first public company ever with quarterly sales topping $100 billion. Anglo-Dutch competitor Royal Dutch Shell PLC wasn’t far behind, posting a profit of $9 billion for the quarter. Those results led Democrats in Congress to demand a new windfall profits tax. “Big oil behemoths are making out like bandits, while the average American family is getting killed by high gas prices, and soon-to-be record heating oil prices,” Sen. Chuck Schumer, D-N.Y., said in a statement. But, Energy Secretary Samuel Bodman said President Bush opposes such a move and is instead considering a wide range of proposals to help cushion consumers, including the creation of an emergency reserve of gasoline and other refined products. Thursday’s outsized earnings are a result of surging oil and natural gas prices that pushed pump prices to record territory after Hurricane Katrina. They come on the heels of similar eye-popping gains reported this week by BP PLC, ConocoPhillips Inc. and Marathon Oil Corp. Chevron Corp. reports its earnings on Friday. Some Republican members of Congress called on the industry to invest in ways that will increase production so that micRS • commucD PRom i Miers failed that test,” said Sen. Edward M. Kennedy, D-Mass., “In effect, she was denied due process by members of her own party,” said Sen. John Warner, a Virginia Republican. And former GOP Sen. Dan Coats, whom the White House assigned to assist her win confirmation, said outside groups and pundits and “perhaps even some senators” had rushed to judgment. Bush, beset by poor poll ratings, an unpopular war in Iraq, high energy prices and the possibility of indictments of White House officials, offered no hint about his thinking on a new nominee. He pledged to make an appointment in a “timely manner.” While White House aides had assembled a lengthy list of contenders prior to Bush’s selection of Miers less than a month ago, most if not all of them were prominent conservative jurists who could be expected to trigger a sharp clash with Democrats. Other, less contentious contenders could come from outside what Bush calls the “judicial monastery,” possibly a current or former senator who could easily win confirmation on a Bipartisan vote. Sen. John Cornyn, a former Texas Supreme Court judge, sidestepped when asked about his own availability, demurring without closing the door on an appointment. “If the president calls me, obviously I’ll answer the phone or go see him if he invites me to come to the White House, but that hasn’t happened and I doubt it will happen,” he said. Whatever the next choice, many Republicans seemed eager to place Miers’ nomination and the intra-party brawl it sparked behind them as quickly as possible. “Let’s move Mark Lorenz / Lawrence Eagle- Tribune Brian Alliette of Methuen, Mass., pumps $50 dollars of gas on Thursday, barely filling half his truck’s tank, at the Exxon station on Route 114 in Lawrence, Mass. Exxon Mobil Corp., the largest publicly traded oil company in the world said third-quarter profit surged, buoyed by higher crude-oil and natural-gas prices, even as the period’s hurricanes hampered production. consumers get a break at the pumps or when they pay their heating bills. But analysts said telling the industry how to spend its money was unfair, if not futile. “Exxon is a good corporate citizen but it does not work for the welfare of the country,” said oil analyst Fadel Gheit at Oppenheimer & Co. in New York. Exxon Chairman and Chief Executive Lee R. Raymond did not mention of the record results in the company’s earnings release. Instead, he noted that the world’s largest publicly traded oil company “acted responsibly in pricing at our company operated service stations, and we also encouraged our independent retailers and distributors to do the same.” Henry Hubble, Exxon’s vice president of investor relations, did note on a conference call the company’s record profit, which rose 75 percent in the quarter to $9.92 billion from $5.68 billion a year ago. He said the gains “reflect the strong commodity prices and our fundamental business model that is disciplined, straightforward and focused on generating value while managing risk.” The previous oil-industry earnings record was Exxon’s 2004 fourth-quarter profit of $8.42 billion. Third-quarter revenue jumped to $100.72 billion from $76.38 billion in the prior-year period. To piit its performance into perspective, Exxon’s revenue for the three-month period was greater than the annual gross domestic product of some of the largest oil producing nations, including the United Arab Emirates and Kuwait — even though it lost considerable production because of a string of hurricanes that battered the U.S. Gulf coast. Robert Kaufmann, a professor at Boston University’s Center for Energy and Environmental Studies, says production will return to pre hurricane levels and hurricane related losses will disappear in future earnings reports, but profits will remain high. “A lot of the capacity was being built when oil was trading at $20 to $30 a barrel range, so by definition those fields are much more profitable,” he said. “Nobody should be surprised by this.” Despite the profit surge, Exxon’s performance fell short of analysts’ expectations and its shares fell 60 cents to $55.60 in trading Thursday on the New York Stock Exchange, while U.S.-traded Class A shares of Shell rose $ 1.15, or 1.9 percent, * to $60.65 on the NYSE. With oil futures above $60 a barrel for much of the third quarter, Exxon’s profits from petroleum exploration and production increased by $1.8 billion to $5.7 billion. Soaring prices for gasoline, diesel and jet fuel lifted refining and marketing profits by $727 million to $2.13 billion. However, income at the company’s chemicals unit declined by $537 million to on,” said Sen. Trent Lott of Mississippi. “In a month, who will remember the name Harriet Miers?” Ironically for conservatives the withdrawal means an extended tenure for Justice Sandra Day O’Connor, whose vote has been decisive over the years on 5-4 rulings that upheld abortion rights, sustained affirmative action and limited the application of the death penalty. Bush issued a statement saying the 60-year-old Miers would remain as White House counsel and praising “her extraordinary legal experience, ■ her character, and her conservative judicial philosophy.” Senate Majority. Leader Bill Frist told reporters, “I expect a nominee quickly ... within days,” and held out the possibility of confirmation hearings before Christmas. The White House worked to depict the collapse of Miers’ nomination as a simple matter _1_ _I J:_ executive privilege. However, in an interview two weeks ago, Republican Arlen Specter, chairman of the Judiciary Committee, had said when asked about possible withdrawal: “I think that would be a sign of incredible weakness.” White House spokesman Scott McClellan said Miers informed Bush of her decision Wednesday night. In the Senate, Frist had been in periodic contact with officials at the White House on Wednesday, offering increasingly dour assessments of Miers’ chances for success. Frist’s spokesman, Bob Stevenson, said the senator talked to White House Chief of Staff Andrew Card during the evening to offer a “frank assessment of her prospects in the committee and the Senate as a whole.” 'f Charles Dharapak / The Associated Press White House counsel Harriet Miers smiles and waves as she walks into the White House on Thursday in Washington. In fact, her nomination never seemed to take hold in the Senate, given the surprise that greeted her appointment, her lack of experience as a judge, the sustained criticism from conservatives in the face of repeated endorsements from Bush. “However nice, helpful, prompt and tidy she is, Harriet Miers isn’t qualified to play a Supreme Court justice on 'The West Wing,’ let alone to be a real one,” conservative columnist Ann Coulter said in one of the more cutting comments. Additionally, Miers failed to generate enthusiasm for her nomination in private meetings with individual senators, according to many lawmakers. Some senators, speaking on condition of anonymity because of the private nature of the sessions, described her as soft-spoken and reticent and difficult to draw out on the b type of issues likely to come before the court. There were fresh problems at mid-week, including the disclosure of a speech Miers delivered in 1993 that touched on the issues of abortion and voluntary school prayer. “The underlying theme in most of these cases is the insistence of more self-determination. And the more I think about these issues, the more self determination makes the most sense,” she said, remarks that sparked fresh criticism from conservative groups. Specter had released a letter stating he intended to question Miers about constitutional issues in the war on terror, including the administrations policy of open-ended detention of suspects at Guantanamo Bay, Cuba. He also said he wanted assurances that Miers would rule without showing “special deference” to Bush if confirmed. $472 million, a reflection of the higher prices for raw materials. Exxon said hurricanes slashed U.S. production volumes by 5 percent from a year ago, while global daily production slipped to 2.45 million barrels of oil equivalent from 2.51 million barrels. By the end of the year, it will cost the- company about $100 million after taxes, the company estimated. At Shell, third-quarter net income grew 68 percent to $9.03 billion from $5.37 billion a year earlier. Revenue at the , London-based company, which has extensive operations in the United States, rose 8 percent to $76.44 billion. ’ “We are capturing the benefits of high oil and gas prices and refining margins,” Shell Chief Financial Officer Peter Voser said, referring to the profit margin on each barrel of crude that is refined into gasoline, diesel and jet fuel. onens prorits rrom exploration and production increased by $2.6 billion to $5 billion in spite of an 11 percent decline in oil and natural-gas output. Its refining and marketing profit climbed by $201 million to $1.7 billion. Its chemicals business saw profits decline by $251 million to $321 million. - Shell said hurricane damage would cost it about $350 million, although much of the expense would be covered by insurance. Also on Thursday, Marathon said third-quarter profit more than tripled to $770 million, up from $222 million a year earlier. Most of the profit came from its oil and natural-gas production unit. However, the results fell short of Wall Streets aggressive estimates and Marathon’s stock slumped $3.80, or 6.2 percent, to $57.28 on the NYSE. THEPWAMECOCK Nobody covers USC better. Nobody. Not even Dr. Phil. I •» IMMM Otw W CtUNMVwllCMlM ltlM I TB«Wj m3M BQJ) m«i; I I nortsoNAur HWMfitD *r bh Mamacr***! s«wce». ihc. Qo/Vhdl fanM AN HISTORIC RESIDENCE Efficiency $550 One Bedroom $610 Two Bedroom $645 Rent includes all utilities and cable TV. All rates quoted are month to month. 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