Chevron has crude oil and natural gas exploration and production operations around the world. In 2011, our worldwide net oil-equivalent production averaged 2.673 million barrels per day, with about 25 percent of the production coming from the United States and the rest from more than 20 different countries.
Continued development of our base business—our existing production facilities—is critical to maintaining the company's oil and natural gas production. Through a strong focus on our operational processes, we have successfully reduced the annual rate of production decline in the base business to about 4 percent, a significant improvement from the 5 percent to 6 percent decline rates in the past. The effective use of our own technology has helped improve long-term field performance.
Production growth is dependent on bringing resources and proved reserves into production through the successful development of major capital projects. Chevron has an extensive lineup of major capital projects under way, from conventional oil and natural gas to deepwater, liquefied natural gas (LNG) and heavy oil developments.
Exploration also is key to future growth. The company's focus areas for exploration in 2011 were the deepwater regions of West Africa, the U.S. Gulf of Mexico and offshore northwest Australia. Drilling and seismic activities were ongoing or being planned in promising fields in Canada, China, Liberia and the United Kingdom.
The 2011 acquisition of Atlas Energy, Inc., provided Chevron with natural gas resources in shale formations in Pennsylvania, Ohio and Michigan. Shale exploration acreage was also added in Canada and Romania.
Partnering for Growth in the Caspian
Chevron is the largest private producer of oil in Kazakhstan, and we're involved in two of the country's largest projects, Tengiz and Karachaganak. Since 1993, Chevron has led the Tengizchevroil (TCO) joint venture in the development of the giant Tengiz and adjacent Korolev fields. A major expansion project, the Sour Gas Injection and Second Generation Plant, increased TCO's oil production capacity by approximately 80 percent, and another expansion project is being evaluated. Chevron also holds a stake in Karachaganak, Kazakhstan's second-largest producing petroleum reserve. And we are the largest private shareholder in the Caspian Pipeline Consortium pipeline, which provides a critical export route for oil from Tengiz and Karachaganak. In 2011, the consortium partners began construction on a major expansion of the pipeline.
In Azerbaijan, Chevron has an interest in the Azerbaijan International Operating Company, which produces and develops offshore oil reserves in the Caspian Sea from the Azeri-Chirag-Gunashli project. We are also a partner in the Baku-Tbilisi-Ceyhan pipeline, which transports oil from landlocked Caspian oil fields to Mediterranean deepwater port facilities.
Investing in the Asia-Pacific Region
As the largest resource holder and producer among international oil companies in the Asia-Pacific region, Chevron is investing in a portfolio of energy resources to meet growing energy demand in the region.
In Australia, the company is leading the development of the Gorgon and Wheatstone LNG and domestic gas projects. The Gorgon Project is Australia's largest single-resource project and has an expected economic life of more than 40 years from the time of startup, which is scheduled for late 2014. We reached a final investment decision for the Wheatstone Project in 2011, with startup expected in 2016. Chevron is a founding partner in the North West Shelf Venture, which supplies natural gas to Western Australia and LNG to customers in the Asia-Pacific region. We also have operated the country's largest oil field, on Barrow Island, for more than 45 years. Chevron continues to make significant investments in exploration offshore northwest Australia and has announced a number of gas discoveries in recent years.
In Thailand, Chevron is the leading natural gas and oil producer. We operate more than 200 platforms in the Gulf of Thailand, where our Platong Gas II project came on line in 2011. Even before the addition of that project's production, we supplied approximately one-third of Thailand's gas demand in 2011.
Elsewhere in the region, Chevron is the top oil producer in Indonesia, and we operate one of the largest steamflood developments in the world at the Duri Field on Sumatra. In China, we operate the Chuandongbei natural gas development. And in Bangladesh, we supply nearly half of the country's natural gas consumption.
Growing With Africa and Latin America
We are applying our expertise and advanced technology to meet the energy needs of growing African and Latin American economies. Our operations include oil and natural gas, LNG, gas-to-liquids, and deepwater and heavy oil exploration and production.
Chevron is ranked among the top petroleum producers in Angola. We invest in major energy projects intended to dramatically increase oil production and conserve natural gas for use in Angola. We are working with our partners on a major development program for the Block 0 concession, offshore Cabinda Province, to significantly increase production. This includes the second stage of the Mafumeira field development—Mafumeira Sul—which is expected to reach a final investment decision in 2012. Also in 2012, the first LNG shipment is expected from the Angola LNG Project at Soyo.
Chevron is the third-largest oil producer in Nigeria and one of the largest investors in the country. We have extensive interests in deepwater Nigeria, including the Agbami Field, one of Nigeria's largest deepwater discoveries. The Agbami Phase 2 project is expected to start up in the second half of 2012. Another deepwater development, the Usan project, began production in first quarter 2012. The company is also working to commercialize natural gas resources. Major projects include the continued expansion of the Escravos Gas Plant and construction of a gas-to-liquids facility at Escravos.
In Latin America, Chevron has operations or interests in six countries. In Brazil, where we have developed the Frade Field, one of the largest deepwater heavy oil projects in the world, construction is continuing on a second deepwater development, Papa-Terra, which is expected to start up in 2013.
Chevron participates in onshore and offshore production projects in Venezuela, including plans for the country's first LNG train and Petropiar, which upgrades extra-heavy crude oil to lighter, higher-value synthetic crude oil. In Colombia, Chevron produces enough natural gas to meet approximately 65 percent of the nation's demand.
Maximizing Mature Resources and Creating New Opportunities
In North America, Chevron uses the latest technology to maintain strong production in mature fields while discovering and developing new resources. We are the third-largest producer of crude oil and natural gas in the United States, with major producing operations in California, the Gulf of Mexico, the Appalachian Basin, Texas, New Mexico and the Rocky Mountains. In February 2011, the company added natural gas resources and shale acreage, primarily in southwestern Pennsylvania, Michigan and Ohio, with the acquisition of Atlas Energy, Inc..
We are a major producer of crude oil and natural gas on the Gulf of Mexico shelf and in the deepwater Gulf of Mexico. Our projects include the Blind Faith and Tahiti deepwater developments. In 2011, construction continued on the Jack/St. Malo and Big Foot projects. Our exploration operations included a discovery in 2011 at the Moccasin prospect in the Lower Tertiary Wilcox Trend.
In 2011, Chevron again ranked No. 1 in net oil-equivalent production in California, primarily from the San Joaquin Valley. Our extensive thermal recovery operations have revolutionized the production of heavy oil from these century-old central California fields. We also are one of the largest hydrocarbon producers in the Permian Basin of West Texas.
In Canada, most of our crude oil production comes from the Hibernia Field offshore Newfoundland and Labrador, and we are a partner in the Athabasca Oil Sands Expansion Project, which produces bitumen—hydrocarbons mixed with asphalts and tars—from oil sands. We are also evaluating a range of unconventional resource options, such as shale gas development in western Canada. We continue to pursue development opportunities offshore eastern Canada and have interests in Canada's western Arctic. The Chevron Arctic Center in Calgary is home base for experts on safe and environmentally sound exploration and resource development in the challenging Arctic environment.
Chevron is the only large international energy company with a continuous upstream presence in the Kingdom of Saudi Arabia. Our partnership spans more than 70 years. On behalf of the kingdom, we conduct exploration and production activities in the Partitioned Zone between Saudi Arabia and Kuwait. Our Large-Scale Pilot Steamflood Project at the Wafra Field is designed to determine the technical and economic viability of thermal-recovery projects in the heavy oil carbonate reservoir.
In Europe, Chevron has a variety of producing operations and exploration interests in the western region of the Shetland Basin, the Norwegian Barents Sea and the U.K. North Sea. Chevron operations in the North Sea have a track record of technological innovation. The Captain Field was one of the first North Sea fields to employ horizontal drilling. In recent years, the company has acquired exploration licenses for shale gas acreage in Poland and Romania.
Updated: April 2012
Cautionary Statement