* Spending program focuses on the development of extensive queue of oil and
gas projects
* Expenditures for 2007 include $17.2 billion of cash and $2.4 billion for
affiliates
* Company also announces a $5 billion extension of its common stock buyback
program
SAN RAMON, Calif., Dec. 7 /PRNewswire-FirstCall/ -- Chevron Corporation
(NYSE: CVX) today announced a $19.6 billion capital and exploratory
spending program for 2007, a 20 percent increase from expected outlays of
approximately $16 billion in 2006.
"Our 2007 capital and exploratory program is a record level of
investment by our company," said Chairman and CEO Dave O'Reilly. "About 75
percent of next year's budget is for oil and gas exploration and production
projects worldwide," O'Reilly added. "Another 20 percent is dedicated to
the company's global refining, marketing and transportation businesses
which manufacture and sell gasoline, clean diesel fuel, biofuels and other
refined products in the company's marketing areas." O'Reilly said the 2007
budget includes $6.7 billion of total investment in the United States.
The majority of the planned increase is related to the company's
exploration and production operations. The higher investment reflects the
impact of several large, multiyear development projects being in their most
capital-intensive phases and the effect of higher costs for materials and
services currently experienced by the oil and gas industry worldwide. "Our
long-range focus on capital discipline in executing our excellent project
queue is critical in this environment," O'Reilly said.
Highlights of the 2007 Capital and Exploratory Spending Program
Chevron 2007 Planned Capital & Exploratory Expenditures $ Billions
U.S. Upstream $4.0
International Upstream 10.6
U.S. Downstream 1.6
International Downstream 2.2
Chemicals and Other 1.2
TOTAL (Including Chevron's Share of Expenditures
by Affiliated Companies) $19.6
Expenditures by Affiliated Companies (2.4)
Cash Expenditures by Chevron Consolidated Companies $17.2
Upstream - Exploration and Production
Capital and exploratory spending of $14.6 billion is budgeted for
exploration, production and natural gas-related projects. A significant
component of this spending relates to upstream development projects that
are building on the company's successful and focused exploration results in
recent years, including opportunities in the deepwater U.S. Gulf of Mexico
and western Africa. Funding is also earmarked for further appraisal and
evaluation of other prospective areas in the world's major hydrocarbon
basins.
"Our upstream investments are aimed at finding and developing oil and
gas resources to increase production and help supply the energy needs of
world markets," said George Kirkland, Chevron's executive vice president of
Upstream and Gas. "Our focus is both on improving the performance of
existing fields and funding new projects that will provide this future
production growth."
Major upstream spending in 2007 includes projects in the following areas:
* U.S. Gulf of Mexico - deepwater exploration and development, including
Tahiti, Great White Perdido, Blind Faith and Jack.
* Angola - deepwater developments, including Tombua Landana, and
construction of liquefied natural gas (LNG) facilities.
* Republic of the Congo - development of the Moho-Bilondo Field.
* Nigeria - continued development of the deepwater Agbami Field, and
additional deepwater exploration.
* Kazakhstan - expansion of the Tengiz Field.
* Australia - further development of the Greater Gorgon Area natural gas
resource offshore Western Australia.
* Canada - expansion of the Athabasca Oil Sands Project.
* Brazil - development of the Frade Field.
Downstream - Refining, Marketing and Transportation
Capital spending of $3.8 billion in 2007 is budgeted for downstream
operations, of which $1.6 billion is for projects in the United States.
These expenditures are aimed at allowing the company to produce cleaner and
more sophisticated fuels, to increase production of transportation fuels
globally, and to enhance the company's ability to manufacture fuels and
other products from heavy and/or sour crude oils.
Outlays in 2007 include projects to upgrade the company's refineries in
Mississippi and California. The company's 50 percent-owned GS Caltex
affiliate is also in the process of a major upgrade to its Yeosu refining
complex in South Korea. And in support of upstream projects to help
commercialize the company's large natural gas resource base outside the
United States, expenditures will be made in 2007 on the construction of LNG
tankers and gas- to-liquids facilities.
Chemicals and Other
Expenditures of approximately $1.2 billion in 2007 are estimated for
investments in chemicals, technology, and other corporate activities.
Technology investments include projects related to molecular
transformation, unconventional hydrocarbon technologies, reservoir
management, and development of second-generation biofuel production
technologies.
Common Stock Repurchase Program
The company also indicated board approval to acquire up to $5 billion
of the company's common stock over a period of up to three years. This
program follows two other $5 billion stock buyback programs that were
initiated in April 2004 and December 2005, with the most recent program
having been completed in 12 months.
Chevron Corporation is one of the world's leading energy companies.
With more than 55,000 employees, Chevron subsidiaries conduct business in
approximately 180 countries around the world, producing and transporting
crude oil and natural gas, and refining, marketing and distributing fuels
and other energy products. Chevron is based in San Ramon, Calif. More
information on Chevron is available at http://www.chevron.com.
Cautionary Statement Relevant to Forward-Looking Information for the
Purpose of "Safe Harbor" Provisions of the Private Securities Litigation
Reform Act of 1995
Some of the items discussed in this press release are forward-looking
statements about Chevron's 2006 capital and exploratory expenditure and
common stock repurchase programs. Words such as "anticipates," "expects,"
"intends," "plans," "targets," "projects," "believes," "seeks,"
"schedules," "estimates" and similar expressions are intended to identify
such forward-looking statements. The statements are based upon management's
current expectations, estimates, and projections; are not guarantees of
future performance, and are subject to certain risks, uncertainties and
other factors, some of which are beyond the company's control and are
difficult to predict. Among the important factors that could cause actual
results to differ materially from those in the forward-looking statements
are crude oil and natural gas prices; refining margins and marketing
margins; chemicals prices and competitive conditions affecting supply and
demand for aromatics, olefins and additives products; actions of
competitors; the competitiveness of alternate energy sources or product
substitutes; technological developments; the results of operations and
financial condition of equity affiliates; inability or failure of the
company's joint-venture partners to fund their share of operations and
development activities; potential failure to achieve expected net
production from existing and future crude oil and natural gas development
projects; potential delays in the development, construction or startup of
planned projects; potential disruption or interruption of the company's net
production or manufacturing facilities due to war, accidents, political
events, civil unrest or severe weather; potential liability for remedial
actions under existing or future environmental regulations and litigation;
significant investment or product changes under existing or future
environmental statutes, regulations and litigation; potential liability
resulting from pending or future litigation; the company's acquisition or
disposition of assets; government-mandated sales, divestitures,
recapitalizations, changes in fiscal terms or restrictions on scope of
company operations; the effects of changed accounting standards under
generally accepted accounting principles promulgated by rule-setting
bodies; and the factors set forth under the heading "Risk Factors'' on
pages 31 and 32 of the company's 2005 Annual Report on Form 10-K. In
addition, such statements could be affected by general domestic and
international economic and political conditions. Acquisitions under the
common stock repurchase program will be made from time to time at
prevailing prices, as permitted by securities laws and other legal
requirements and subject to market conditions and other factors. The
program may be discontinued at any time. Unpredictable or unknown factors
not discussed herein also could have material adverse effects on
forward-looking statements. Unless legally required, Chevron undertakes no
obligation to update publicly any forward-looking statements, whether as a
result of new information, future events or otherwise.
SOURCE Chevron Corporation
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Related links:
http://www.chevron.com
CONTACT:
Donald Campbell of Chevron Corporation,
+1-925-842-2589
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