CHEVRON SCHEDULES 20% INCREASE IN OUTLAYS FOR 1991

Chevron Corp. will boost capital and exploratory spending by an estimated $800 million, or about 20% this year compared with 1990. Chevron said much of the investment will go to projects that will help limit dependence on Middle East oil. The company plans to spend more than $5.1 billion in its 1991 program. The program, which includes Chevron's share of spending by affiliates, is based on forecast oil prices that are considerably lower than today's.

Jan. 21, 1991

2 min read

Chevron Corp. will boost capital and exploratory spending by an estimated $800 million, or about 20% this year compared with 1990.

Chevron said much of the investment will go to projects that will help limit dependence on Middle East oil.

The company plans to spend more than $5.1 billion in its 1991 program. The program, which includes Chevron's share of spending by affiliates, is based on forecast oil prices that are considerably lower than today's.

Chairman Ken Derr pointed out that Chevron's major exploration and production projects around the world are all outside the Persian Gulf. Chevron has no major operations there.

SPENDING BREAKOUT

Chevron plans about $2.7 billion in exploration and production spending, almost half in the U.S. That's up about 20% from 1990 for U.S. and international spending.

Planned U.S. outlays include deepwater oil and deep gas developments in the Gulf of Mexico, continued expansion of enhanced oil recovery projects in California, and enhanced oil recovery in West Texas.

Internationally, spending will include the Kutubu oil project in Papua New Guinea, Alba field development in the U.K. North Sea, two large EOR projects in Indonesia, development and exploration in West Africa, Hibernia field development off Newfoundland, and initial funds for the Tengiz field project in the Soviet Union, which is not yet approved.

Planned capital spending on refining and marketing is about $1.7 billion, with $1.1 billion of that scheduled for U.S. projects.

The U.S. program, up about 20% from 1990, includes preliminary work on modernization of the company's 270,000 b/cd Richmond, Calif., refinery. This proposed project, which will cost about $1 billion during several years, will equip the plant to produce more transportation fuels from each barrel of crude refined.

The U.S. program includes funds for modernization of Chevron U.S.A.'s service station program network, as well as for many projects for environmental protection and compliance.

About $600 million will be spent on international refining and marketing, mostly by Caltex Petroleum Corp., which continues its expansion and modernization program in Asia. Caltex is 50% owned by Chevron.

The international program includes two double hulled tankers ordered by Chevron Shipping Co.

In chemicals, Chevron plans to spend about $350 million in 1991, down about 15% from 1990 as spending on several major projects is concluded. The 1991 program includes completing a U.S. polyethylene plant expansion at Cedar Bayou, Tex.