Exploration and Production
Chevron has interests in one operated and three nonoperated projects in China.
In August 2008, Chevron became the operator in the Chuandongbei natural gas area in the onshore Sichuan Basin, holding a 49 percent interest. Subsurface reservoir and front-end engineering work was completed in 2008. At an estimated cost of $4.7 billion, plans call for two sour gas processing plants with a capacity of 740 million cubic feet per day. We started seismic programs in 2008 to evaluate the prospects in Chuandongbei in an area that spans 487,000 acres (1,969 sq km).
Chevron has a 32.7 percent nonoperated interest in offshore Blocks 16/08 and 16/19 in the Pearl River Delta Mouth Basin of the South China Sea. Joint development of the HZ25-3 and HZ25-1 crude oil fields in Block 16/19 commenced in first quarter 2007. The project includes the installation of a single platform, the drilling of 10 wells, and the use of existing infrastructure of Blocks 16/08 and 16/19. First production was planned in third quarter 2009, with ramp-up to maximum total daily production of approximately 11,000 barrels of crude oil expected in 2011.
In Bohai Bay, the company holds a 16.2 percent interest in the producing BZ 25-1 Field in Block 11/19.
Also in Bohai Bay, Chevron has a 24.5 percent interest in the QHD-32-6 oil field, the first CNOOC-operated development involving foreign participation. The field consists of six wellhead platforms, a floating production, storage and offloading vessel, and a single-point mooring system.
In the onshore Ordos Basin, Chevron holds a 50 percent interest in the Linxing Block. As of early 2009, Chevron was negotiating for contract term extensions for the 50 percent interest in the San Jiao Bei and Shenfu blocks as well as the 35.8 percent interest in the Baode Block.
Total average daily production in 2008 from the company's interests in China was 87,000 barrels of crude oil and condensate and 80 million cubic feet of natural gas. The company's average net-oil equivalent production was 22,000 barrels per day.
Marketing and Retail
Caltex operates 85 service stations in China, including those in the Hong Kong and Macau Special Administrative regions. We expanded our network of retail outlets mainly in Guangdong Province. The stations, which are operated by Caltex South China Investment Ltd., are equipped with convenience retail stores.
Marketed under the Caltex brand, our lubricants business has sales and marketing, manufacturing, and distribution operations throughout the country, including key markets such as Beijing, Shanghai, Guangzhou, Chengdu, Tianjin and Hong Kong. Chevron also partners to market and distribute its products in Central China. Caltex Havoline® and Delo® engine oils and Extended Life Coolants are among the best-selling lubricants and specialty products in their class and are widely used as factory fill and after-market products by automotive and original equipment manufacturers alike.
Chevron owns a liquefied petroleum gas terminal through the joint venture Chevron Ocean Gas and Energy Limited in Shantou, Guangdong province. The terminal has two 100,000-cubic-meter underground storage caverns and three berths for loading and unloading liquefied petroleum gas.
Chevron operates a 100,000-metric-ton-per-year asphalt terminal in Shandong province through our subsidiary, Rizhao Chevron Asphalt Co. Ltd.
Chevron Global Aviation is one of the major jet fuel suppliers at the Hong Kong International Airport. We also supply jet fuel to airlines that use the Macau International Airport.
Chevron Phillips Chemical Company LLC (CPChem), which is half-owned by Chevron, operates a polystyrene plant capable of producing 100,000 metric tons per year of polystyrene, used for plastic consumer products in Zhangjiagang City, Jiangsu Province.
CPChem also has a 40 percent interest in a joint venture that manufactures and markets high-density polyethylene pipe.
CPChem sells paraxylene, a raw material used in making synthetic polyester fibers, and benzene to major Chinese chemical and fiber manufacturers.
Chevron Oronite maintains an office in Beijing to handle the sales of lubricants and fuel additives to national and international oil companies as well as to local lubricants blenders. The company provides products for marine, automotive and industrial uses.
Updated: March 2009