U.S. oil producer Chevron Corp. on Dec. 1 said it plans to boost spending on new oil and gas projects in 2022 by 20% to $15 billion, while also raising shareholder returns.

Major oil companies are responding to a jump in profits this year from higher oil and gas prices, and have signaled they plan to revive outlays for drilling and carbon-reduction measures.

Chevron increased its share buyback guidance range to $3 billion-$5 billion per year, up from a $2-$3 billion range set in July.

The new level brings its investor-friendly buyback program back to pre-pandemic levels. It was distributing $5 billion per year before the pandemic forced a suspension.

However, it keeps spending on projects below the $20 billion initially planned for 2020, months before the effects of the coronavirus hit its operations.

The spending plan “reflects Chevron's enduring commitment to capital discipline,” Chevron CEO Michael Wirth said.

While the 2022 spending budget is higher than this year's forecast spend, it is at the low end of Chevron’s previous $15 billion to $17 billion per year guidance range.

The company has been cutting debt and freeing cash flow for shareholder distributions after this year's rebound in crude oil prices, which reached a 7-year high in October.

Chevron will spend $3 billion next year at its U.S. Permian Basin operations out of the approximately $8 billion allocated to oil and gas producing assets. Another $2 billion will be deployed in its Tengiz field in Kazakhstan.

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