Hello, welcome to this audio webcast discussing Saudi Aramco's half-year 2019 results, announced earlier today. I'm Fergus MacLeod, Saudi Aramco's head of investor relations, and I'm joined today by Mr. Khalid Al-Dabbagh, Saudi Aramco's chief financial officer. There'll be a presentation followed by a question and answer session, and we anticipate the entire call lasting no more than an hour. As a reminder, this webcast and conference call are being recorded. Before we start, I'd like to draw your attention to the customary cautionary statement. During today's presentation, we may make forward-looking statements that refer to estimates, plans, and expectations. Actual results and outcomes could differ materially due to factors we note on this slide. Please refer to the filing of our half-yearly financial report on the London Stock Exchange Regulatory News Service and also posted on our website for more details.
I'll now hand over the call to Khalid.
Thank you, Fergus. Good afternoon, ladies and gentlemen. I would like to welcome you and thank you for taking the time to join our webcast. I am delighted to be here with you to discuss our financial results for the first half of 2019, released earlier today. The release of our results and today's call are part of our ongoing programs of strengthening communications with investors. I will begin with a summary of our first half performance. Let me start with financial performance, which we believe is unmatched. Our first half 2019 net income was $46.9 billion. Earnings before interest and tax in the first half was $92.5 billion. Our cash generation continues to be strong with free cash flow of $38 billion in the first half of 2019. CapEx in the first half of 2019 was $14.5 billion.
This was achieved while maintaining the strength of our balance sheet. Operationally, the business continues to perform well. Total first half 2019 hydrocarbon production was 13.2 million barrels of oil equivalent per day. Average daily crude production was 10 million barrels per day. A focus on the environment, safety, and innovation is at the core of our operations, as demonstrated by the key metrics on this slide. I will say more about this important subject in a moment. Turning now to our strategic objectives. Our themes are shown on this slide. Firstly, in the upstream, our goal is to maintain our position as a world-leading crude oil producer and the lowest cost producer while providing reliable crude oil supply to customers.
In the downstream, our aim is to further diversify our operations, growing and optimizing the performance of our business and increasing the proportion of petrochemical production, capturing incremental margin in the hydrocarbon value chain. We plan to expand gas activities, which will have the dual benefit of reducing carbon emission and freeing up more liquids from our domestic utility systems for exports. Underpinning these goals is our efficient capital allocation and our prudent and flexible balance sheet. Let me highlight the key milestones we saw in the first half of 2019 as we implement this strategy. In the upstream, we continue to reinforce our position as the world's most reliable and profitable supplier of energy with the development of the Marjan and Berri crude and gas increment projects, which have started.
These major programs are planned to contribute production capacity of 550,000 barrels per day of oil and 2.5 billion standard cubic feet of gas by 2023. We are also making strong progress in expanding our gas activities with the 2.5 billion standard cubic feet per day Fadhili gas plant project, which is being on track for startup in 2019. Exploration success continues with the extension and discoveries in both oil and gas. In the downstream, we continue to make progress across the hydrocarbon value chain to capture the benefits from value accretive integration. In chemicals, we signed an agreement to acquire a 70% equity stake in SABIC from the Public Investment Fund of Saudi Arabia. SABIC has a track record of being among the most profitable petrochemical companies globally.
This acquisition is a major step in achieving our downstream growth strategy of integrated refining and petrochemicals to maximize the profitability from every molecule we produce. In refining, agreements were signed to acquire both Shell's 50% share in SASREF, a 305,000 barrels per day joint venture in the industrial city of Jubail, and 17% of Hyundai Oilbank, a 650,000 barrels per day refining plant in South Korea. These deals are expected to close by year-end and are part of our strategy to further secure placement of our crude in growing demand centers. In addition, we have passed the landmark in building brand recognition with an agreement with Total of France to enter the retail fuel markets in the kingdom with the acquisition of 270 retail network stations under the Sahel brand.
Moreover, our trading business continues to pursue its objective of being a key global trader, optimizing the company's portfolio while capturing profitable opportunities. I would like to emphasize that our overall corporate strategy is underpinned by a focus on the efficient allocation of capital and on maintaining a prudent and flexible balance sheet, reinforced by a strong corporate governance framework. Turning to the important issue of the environment, which is a top priority for all of us at Saudi Aramco. Environmental issues have been at the forefront of the way we operate for many decades. We are particularly proud of the fact that our upstream carbon intensity, that is the amount of greenhouse gases associated with each barrel we produce, is the lowest among our peers. This figure has been verified by a certified third party. Furthermore, our upstream Methane Intensity is also lower when compared to our peers.
Our flaring intensity remains at less than 1% of our gas production. Finally, I will turn to the balance between the sources and uses of cash, comparing the first half of 2019 with the first half of 2018. As you can see, net cash inflows from operations were broadly similar year on year. Capital expenditures of $14.5 billion were lower than a year ago. Total dividends paid to our shareholder in the first half of 2019 were $46.4 billion. This comprises an ordinary dividends payment of $26.4 billion and a special dividend of $20 billion. The special dividends paid earlier this year reflected the exceptionally strong financial performance we delivered in 2018. Balance sheet gearing at the end of the first half of 2019 was around 2.5%. I would like to summarize the presentation today with the following points.
We, in Saudi Aramco, have delivered strong and unmatched financial results despite lower oil prices and volatile market condition. This is really a testament to our resilience. Saudi Aramco continues to demonstrate its ability to deliver superior financial and operational performance under all conditions. We have confirmed that our upstream carbon intensity is among the lowest of any major producer in the world. Finally, our commitment to operational excellence and safety continue unabated with impressive levels of performance compared to peers. Thank you once more, and everyone enjoy your day