Chevron 2007 Annual Report Supplement

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Upstream Other International Exploration The company drilled a successful exploratory well in the Manatee area of Block 6d in 2005. This well extended the six shallow gas sands discovered in Venezuela’s Loran Field in Block 2 into Trinidad and Tobago. In early 2007, an agreement was signed by the governments of Venezuela and Trinidad and Tobago to unitize the Loran Field and the Manatee area. Negotiations were expected to continue in 2008 to achieve a field-specific unitization treaty. In 2007, the company assessed development alternatives for the unitized area and completed the pre-FEED conceptual development planning. Venezuela Chevron producing activities in Venezuela are performed by two affiliates in western Venezuela and one affiliate in the Orinoco Belt. Chevron also has interests in three offshore exploratory blocks located in the Plataforma Deltana region offshore western Venezuela. Production Total daily production in 2007 from the three affiliates averaged 269,000 barrels of liquids and 120 million cubic feet of natural gas. The company’s net oil-equivalent production in 2007 was 72,000 barrels per day. Petroboscan The company holds a 39.2 percent interest in Petroboscan, which operates the onshore Boscan Field in western Venezuela, for a 20-year contract period expiring in 2026. During 2007, Petroboscan total daily production averaged 105,000 barrels of liquids (28,000 net) and 16 million cubic feet of natural gas (6 million net). A 3-D seismic program was acquired in 2007 that is expected to guide future development activities in South Boscan. The water-injection pressure-maintenance project was expanded to include four wells converted to injectors in 2007, and four new injectors are planned to be drilled in 2008 and 2009. Petroindependiente The company holds a 25.2 percent interest in Petroindependiente, which operates the LL-652 Field in Lake Maracaibo, for a 20-year contract period expiring in 2026. During 2007, Petroindependiente total daily production averaged 7,000 barrels of liquids (1,000 net) and 64 million cubic feet of natural gas (11 million net). Hamaca The Hamaca project, located in Venezuela’s Orinoco Belt, has a total design capacity for processing and upgrading 190,000 barrels per day of heavy crude oil (8.5 degrees API gravity) into 180,000 barrels of lighter, higher-value crude oil (26 degrees API gravity). In February 2007, the president of Venezuela issued a decree announcing the government’s intention for Petróleos de Chevron Corporation 2007 Supplement to the Annual Report Venezuela, S.A. (PDVSA), Venezuela’s national oil company, to increase its ownership in all Orinoco Heavy Oil Associations, including Chevron’s 30 percent-owned Hamaca project, to a minimum of 60 percent. In December 2007, Chevron executed a conversion agreement and signed a charter and by-laws with a PDVSA subsidiary that provided for Chevron to retain its 30 percent interest in the Hamaca project. The new entity, Petropiar, commenced activities in January 2008. During 2007, total daily production averaged 157,000 barrels of liquids (39,000 net) and 40 million cubic feet of natural gas (10 million net). Exploration Chevron holds a 60 percent interest in Block 2 and a 100 percent interest in Block 3, two of five offshore blocks in the northeastern Plataforma Deltana Region. In Block 2, which includes the Loran Field, a conceptual offshore development plan was completed in 2007. In Block 3, Chevron discovered natural gas in 2005 that is in close proximity to Loran. Block 3 and Loran are possible sources of supply for Venezuela’s first LNG train. Seismic work elsewhere in Block 3 was completed in 2007. Chevron has a 100 percent interest in the Cardon III Block, located north of the Maracaibo producing region. A 30 percent farm-out was planned for the block by mid-2008. Seismic data in this block, which has natural-gas potential, was acquired in 2007 and was planned to be processed in 2008. PDVSA has the option to increase its ownership to 35 percent in all three company-operated blocks upon declaration of commerciality. Canada Chevron has ownership interests in oil sands projects at Athabasca and Ells River in the province of Alberta, exploration and development projects offshore in the Atlantic region, and exploration and discovered resource interests in the Mackenzie Delta and Beaufort Sea region of Canada’s western Arctic. Chevron’s net daily production in 2007 from Canadian operations was 35,000 barrels of crude oil, 5 million cubic feet of natural gas and 27,000 barrels of bitumen from oil sands. ��
Athabasca Oil Sands Project The company holds a 20 percent nonoperated working interest in the Athabasca Oil Sands Project (AOSP). Total daily bitumen production in 2007 averaged 142,000 barrels (27,000 net). Oil sands are mined from the Muskeg River Mine and bitumen is extracted from the oil sands and upgraded into synthetic crude oil using hydroprocessing technology. Chevron’s net proved reserves for the Muskeg River Mine as of year-end 2007 were 231 million barrels of bitumen. AOSP has resources in place to support total daily bitumen production in excess of 500,000 barrels and enables Chevron to participate on a 20 percent nonoperated-working-interest basis in oil sands leases near Fort McMurray, Alberta. The first expansion of AOSP was approved in November 2006 at a total projected cost of $10.2 billion. The 100,000-barrel-per-day expansion, which includes a new mine, named Jackpine, and upgrading facilities, is expected to increase AOSP’s bitumen production design capacity to more than 255,000 barrels per day in 2010. Chevron’s net proved reserves for the Jackpine Mine as of year-end 2007 were 205 million barrels of bitumen. Preliminary work was also under way in early 2008 to determine the feasibility of additional AOSP expansion projects. Oil sands production at Athabasca is considered a mining operation rather than an oil and gas operation under the rules of the U.S. Securities and Exchange Commission, so the oil sands reserves are not included with the company’s reported volumes of proved reserves of oil and gas. Ells River “In Situ” Oil Sands Project In 2007, the company continued to acquire heavy oil leases in the Athabasca region of northern Alberta. The area comprises more than 85,000 acres (344 sq km). The potential for production is through the utilization of Steam Assisted Gravity Drainage, a proven “in situ” technology that uses steam and horizontal drilling to extract bitumen. The company began activities at the 60 percent-owned and operated Ells River Project with a successful appraisal drilling program involving 66 wells that were completed in 2007. Follow-up appraisal activities were under way in 2008 with a similar number of wells and a small 2-D and 3-D seismic program. Atlantic Canada At the 27 percent-owned and partner-operated Hibernia Field, average total crude-oil production in 2007 was 135,000 barrels (34,000 net) per day. Average annual production has declined from prior years as a result of significantly increased levels of water in producing wells and reduced operating efficiency. As of year-end 2007, Hibernia had produced 570 million of the estimated 900 million barrels of crude oil potentially recoverable over the field life. In 2007, one production well and one injection well were completed into the Hibernia formation. A second production well targeting the Hibernia formation was suspended because of technical difficulties and was scheduled to be completed in 2009. One injection well and one delineation well were completed in the Ben Nevis Avalon formation in 2007. Other International Upstream Chevron holds a 28 percent operated interest in a potential development project at the Hebron Field located offshore the province of Newfoundland and Labrador. This heavy-oil field is estimated to contain between 400 million and 700 million barrels of potentially recoverable volumes. During the summer of 2007, the joint venture executed a nonbinding memorandum of understanding with the provincial government of Newfoundland and Labrador that outlines fiscal, equity and local benefits terms associated with the Hebron Atlantic Canada Development Project. Formal agreements were being developed, with signing and execution anticipated in 2008. Chevron also holds a 50 percent operated interest in eight Orphan Basin exploration licenses totaling 5.2 million acres (21,044 sq km). One wildcat well was drilled in Orphan during 2006 and 2007, and further exploration activities are planned over the next three years. Western Arctic Chevron has a large onshore exploration lease position in the Mackenzie Delta region. Under an extensive areawide farm-out agreement, two exploration wells were drilled on Chevron leases in 2007. Additional drilling and seismic operations were planned for 2008. In July 2007, Chevron acquired a Beaufort Sea offshore exploration license that covers approximately 267,000 acres (1,082 sq km) located approximately 50 miles (80 km) northwest of the Mackenzie Delta onshore exploration lands. Chevron holds a 32.5 percent nonoperated working interest in the offshore Amauligak discovery and is assessing development concept alternatives. The company also holds a 13 percent nonoperated working interest in the Issungnak discovery and additional minor working interests in other offshore licenses with significant discoveries in the Beaufort Sea. Greenland Exploration In October 2007, Chevron was awarded a 29.2 percent nonoperated working interest in the exploration license 2007/26 in Block 4 offshore West Greenland in the Baffin Basin. The planned four-year work program includes seismic acquisition, and geologic, engineering and environ- mental studies. Denmark Chevron holds a 15 percent nonoperated working interest in the Danish Underground Consortium (DUC), which produces crude oil and natural gas from 15 fields in the Danish North Sea and has a 12 percent interest in each of four exploration licenses. Production Average total daily production in 2007 from the DUC was 273,000 barrels of crude oil and 63 million cubic feet of natural gas. The company’s net oil-equivalent production in 2007 was 63,000 barrels per day. Chevron Corporation 2007 Supplement to the Annual Report
Page 1 and 2: Energy Performance 2007 Supplement
Page 3 and 4: 2007 at a Glance Accomplishments Co
Page 5 and 6: Consolidated Statement of Income Ye
Page 7 and 8: Consolidated Balance Sheet At Decem
Page 9 and 10: Capital and Exploratory Expenditure
Page 11 and 12: Miscellaneous Data 007 2006 2005 20
Page 13 and 14: Highlights Worldwide net oil-equiva
Page 15 and 16: • Kazakhstan - Ramp-up of expande
Page 17 and 18: Kettleman Hills Chevron increased i
Page 19 and 20: • Jack, a 2004 discovery at Walke
Page 21 and 22: Development Drilling activity withi
Page 23 and 24: Development South Offshore Water In
Page 25 and 26: Asia-Pacific Major producing countr
Page 27 and 28: Kazakhstan Chevron is the largest p
Page 29 and 30: Thailand In the Gulf of Thailand, C
Page 31 and 32: Exploration The Ordos Basin blocks
Page 33 and 34: Remaining production from the Rokan
Page 35: Exploration During first-half 2007,
Page 39 and 40: Production Total daily production i
Page 41 and 42: Major Development Projects 1 Maximu
Page 43 and 44: Net Oil-Equivalent Production 1 Yea
Page 45 and 46: Net Natural Gas Production 1 Year e
Page 47 and 48: Natural Gas Realizations 1 Year end
Page 49 and 50: Net Wells Completed * Year ended De
Page 51 and 52: Highlights Downstream is a key elem
Page 53 and 54: Marketing The Marketing organizatio
Page 55 and 56: Transportation The company’s tran
Page 57 and 58: Refining Capacity at Year-End 2007
Page 59 and 60: Refined-Product Sales Year ended De
Page 61 and 62: Chemicals ChEvRON CORPORATION Photo
Page 63 and 64: Manufacturing and Research and Deve
Page 65 and 66: Technology Chevron has three techno
Page 67 and 68: Mining Chevron’s U.S.-based minin
Page 69 and 70: Synthetic Crude Oil A marketable an
Page 71 and 72: Chevron History 1879 Incorporated i

Chevron 2007 Annual Report Supplement

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