Focusing on Worldwide Exploration
The resumption of peace following World War II infused Standard Oil Co. of California (Socal) with new energy, new opportunities and an enterprising quest for new oil and gas resources. To satisfy the growing need for petroleum products, the company frequently devoted more than two-thirds of its annual expenditures to exploration and development.
A Standard Oil geologist examined a rock specimen in the Venezuelan Andes in 1958, where there was an effort to build on the discovery of oil at the country's Boscan Field a decade earlier. During the years following World War II, the company mounted an aggressive exploration program, which led to discoveries as far ranging as the U.S. Gulf of Mexico, Canada, Saudi Arabia and Indonesia. (Chevron Photo)
And the company's high success rate helped to maintain its position as the third-largest oil producer in the United States and the No. 1 producer in California. Particularly encouraging news came from the jungles of Sumatra, where the company learned that the Japanese occupying force had actually struck oil at Minas No. 1, using a rig left behind by Caltex Pacific Indonesia when crews vacated the area in 1941.
In late 1949, when Caltex Pacific finally resumed development of the field, the company realized that Minas was an oil giant, which would yield 1 billion barrels over a 17-year period, from 1952 to 1969. Caltex Pacific would gain major additional production from the Duri Field, which was discovered in 1941 and developed during the early 1950s.
In the decade following the war, Socal's major U.S. discoveries included the Kelly-Snyder Field in West Texas; the Main Pass, Bay Marchand and Romere Pass fields in the offshore waters of the Gulf of Mexico, where the company became the largest oil producer as of 1949; and the Rangely Field in the Rockies of Colorado.
Internationally, Standard had major successes at the Acheson Field near Edmonton, Canada, and the Boscan Field in Venezuela. And in Saudi Arabia, when drilling resumed in 1947, the company learned that its concession area in the Enala Anticline contained the largest oil pool in the world — 105 miles of productive sands.
Building Pipelines
Socal engineers achieved a major feat in building a pipeline over the highest pass any line had ever crossed. The pipeline brought oil from the Rangely Field to a newly constructed refinery in Salt Lake City.
And in Saudi Arabia, construction of the 1,068-mile Trans-Arabian Pipeline entailed use of a sky hook to move the 325,000 tons of steel pipe from a wharf in the Persian Gulf to a yard three miles away. From there, the steel was transported across the desert to the fields, where the pipeline was finally completed in September 1950.
Pioneering in Petrochemicals
In the postwar period, the company built on its position as a major supplier of petrochemicals by developing a wide array of new products.
After the U.S. government gave Socal special priority to build the nation's first synthetic detergent plant in 1945, the company had a solid footing to produce a wide array of industrial chemicals such as detergents, plastics and synthetic fabrics.
In 1951, the company created the Oronite Chemical Co. to market a growing output of petrochemicals. Three years later, the Richmond Refinery completed the nation’s first unit to manufacture paraxylene, a basic material for making Dacron and other synthetic fibers.
An Era of Growth
Reflecting Socal's growth in these postwar years, revenues surpassed $1 billion for the first time in 1951. This growth continued, initially topping $2 billion in 1961, and climbing to almost $6 billion by 1969. The keystones of Socal’s success were its product sales, production increases and strong record of replacing reserves.
Throughout this period, Socal developed a wide range of new products, including Chevron and Chevron Supreme Gasoline, introduced in 1945; RPM motor oils in 1950; "Skypower" gasolines in 1956; new Chevron Supreme Gasoline and new RPM Supreme Motor Oil in 1957; and Chevron Custom Supreme, the first three grade gasoline in the West, in 1959.
Extending the Market
Socal's marketing reach now extended far beyond the original five-state base in the Western United States. After acquiring the Perth Amboy Refinery in 1945, the company used it as a manufacturing base a couple of years later when it launched an expanded marketing network in 12 Eastern states through its subsidiary,
California Oil Co.
U.S. expansion continued in 1961 when the company merged with Standard Oil Co. (Kentucky), the market leader in petroleum products in five Southeastern states. To serve this market with crude oil from fields in the Gulf of Mexico, the company constructed the 100,000-barrel-a-day refinery at Pascagoula, Mississippi, in 1963.
Other Western Hemisphere marketing operations included service station networks in Guatemala, El Salvador, Honduras and Costa Rica, designed to keep pace with the expanding economies of Central America.
A New Presence in Europe
In Western Europe, Socal agreed to dissolve the Caltex structure in that area and split its operations between the two parent companies, Socal and Texaco. To manage a share of the divided operations, the company created Chevron Oil Europe in 1967.
Paralleling the growth in marketing and producing operations, the company enlarged and diversified its manufacturing capabilities in the Eastern and Western Hemispheres. At the Richmond Refinery in 1965, the company launched the world's largest Isomax hydrocracking complex, which converted heavy petroleum oils to light stocks used to make gasoline and other products.
In 1969, Standard completed a 150,000-barrel-a-day expansion of its refinery at Pernis in the Netherlands, and a year later brought onstream a new 250,000-barrel-a-day refinery at Freeport in the Bahamas. Many of the expansions and modernizations focused on enabling plants to convert greater quantities of high-sulfur crude into products that met environmental specifications.
In Marine, Bigger Is Better
Standard expanded its fleet in 1970 by adding six new very large crude carriers (VLCCs), supertankers of 250,000 or more tons. The VLCCs allowed the company to move bulk oil around the southern tip of Africa, avoiding any supply disruptions such as occurred in 1967 with the closing of the Suez Canal.
Overcoming Political Disruptions
During the 1970s, the petroleum industry was confronted by many political issues - from the 1973 oil embargo to the nationalization of company assets by Libya, Venezuela and other oil producers.
Nevertheless, the decade was marked by numerous milestones, including major discoveries ranging from the West Pembina Field in Alberta, Canada, to the Ninian Field in the United Kingdom North Sea, and from the Middleton and North Apoi oil fields in Nigeria in 1972 to the giant Hibernia Field offshore Newfoundland in 1979. With these discoveries, Socal achieved a production record of more than 3.5 million barrels of oil equivalent in 1976, a year in which the world rebounded from an economic recession.
What's in a Name
In 1977, the company made a major organizational change when it formed Chevron U.S.A. Inc., merging six domestic oil and gas operations into one. This change was driven by the need to establish a nationwide identity and a consolidated organization.
The company naturally chose "Chevron," a name that had first appeared on its products in the 1930s and had become its most recognizable mark of identification among consumers around the world.
As Chevron marked its centennial in 1979, Chairman of the Board Harold J. "Bill" Haynes saluted "all those people whose ideas and hard work caused our company to grow and prosper over the past 100 years" and encouraged everyone in the current organization to summon up the "vigor and creativity" that would help us to flourish in future years.