Chevron 2003 Annual Report Download - page 9

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GLOBAL UPSTREAM
The objective of our global upstream business is to grow profitability in our core
areas and build large, new legacy positions. We are well positioned to do both.
ChevronTexaco is the top crude oil and natural gas producer in Angola and
Kazakhstan and the top crude oil producer in Indonesia. It is one of the largest crude
oil and natural gas producers in the United States, West Africa, Asia-Pacific and Latin
America. We also are the only international oil company allowed to operate on
behalf of the Kingdom of Saudi Arabia in the Partitioned Neutral Zone between
Saudi Arabia and Kuwait. ChevronTexaco is the No. 1 holder of natural gas resources
in Australia and has significant positions in North America, West Africa, Kazakh-
stan and Latin America.
We are one of the world’s largest producers of heavy oil, which represents an
estimated one-third of our hydrocarbon reserves. Heavy oil assets include fields in
the San Joaquin Valley in California, where we are the largest heavy oil producer;
the Hamaca project in Venezuela; Indonesia, site of the world’s largest steamflood
project; and the Athabasca oil sands in Canada.
Our exploration interests are focused on the world’s most promising areas, includ-
ing the deepwater U.S. Gulf of Mexico and West Africa.
> Results and Opportunities During the year, we made significant progress on a
number of fronts, including major development projects, exploration successes,
commercial agreements, the acquisition of promising new exploration acreage and
portfolio upgrades.
For the 11th consecutive year, proved crude oil and natural gas reserves replacement
exceeded 100 percent. The company added approximately 1 billion oil-equivalent
barrels of net proved reserves, or 108 percent of volumes produced in 2003. Addi-
tions included the results of contract extensions in Denmark and Colombia, drilling
activities in the United States, improved recovery techniques in Indonesia and the
United States, and revisions from reservoir studies and analyses in Kazakhstan.
In 2003, three major developments were completed. In Africa, the Chad-Cameroon
project came onstream and sales began. The development is expected to reach a
maximum production rate of 225,000 total barrels per day in mid-2004. In Canada,
the start-up of integrated operations was completed for the Athabasca Oil Sands
Project. Full capacity is expected to reach 155,000 barrels of bitumen per day. In
Kazakhstan, we completed a major pipeline extension to move Karachaganak
processed liquids to world markets.
The company has a slate of other major crude oil and natural gas developments
that will be moving forward in 2004. Production facilities are being constructed
KEY RESULTS
GLOBAL UPSTREAM
> Deepwater U.S. Gulf of Mexico discoveries
made at Sturgis, Perseus, Tubular Bells and
Saint Malo; agreement reached to operate
Blind Faith prospect.
> Deepwater drilling success achieved in Ni -
geria at Aparo, Nsiko and Usan.
> First crude oil production and sales begun
from Chad- Cameroon project.
> Start-up of integrated operations com-
pleted for Canada’s Athabasca Oil Sands
Project.
> Export pipeline completed to allow trans-
port of processed liquids from Karachaganak
Field in Kazakhstan to world markets.
> Oil-equivalent proved reserves additions
exceeded production for the 11th consecu-
tive year.
GLOBAL GAS
> Progress made in the Greater Gorgon Area
development: approval in-principle for an
LNG facility on Barrow Island and letter
agreement with the China National Offshore
Oil Corporation to purchase production and
an equity stake in the development, pend-
ing completion of formal contracts.
> Licenses awarded for construction of Port
Pelican LNG terminal offshore Louisiana
in the United States and for operatorship
of Plataforma Deltana Block 2 offshore
Venezuela.
> Permits fi led to construct LNG terminal
offshore Baja California, Mexico, to serve
North American markets.
GLOBAL DOWNSTREAM
> Reorganization completed by functional
rather than geographic areas to lower costs
and create new effi ciencies.
> Projects completed at three refi neries to
enable the manufacture of cleaner fuels and
to increase the yield of high-value products.
> Richmond, California, refi nery in the United
States achieved its best-ever refi nery utili-
zation rate.
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