press release

Chevron Press Release - Chevron And BP Sign Eastern North Slope Agreement

SAN FRANCISCO, Feb. 16, 1998 -- Chevron U.S.A. Inc. and BP Exploration Alaska Inc. have entered into an agreement aligning their respective leasehold interests in the Point Thomson area east of Prudhoe Bay.

The alignment area, covering more than 450,000 acres, encompasses the Point Thomson Unit, and the Sourdough, Flaxman and Point Thomson discoveries. The alignment of leasehold interests also covers a number of exploration prospects both within and outside the unit.

Under the terms of the alignment agreement, BP holds a 56 percent interest in the two companies' joint lease holdings in the area, and Chevron holds the remaining 44 percent.

Multidisciplinary teams of Chevron and BP staff are conducting joint planning and management activities to improve exploration, development and production of existing and new joint oil and gas opportunities in the area.

Work teams are developing interpretations and integrated business plans for geophysical, geological, reservoir, drilling and facility-related activities. Team members are located in BP's Anchorage office.

This arrangement leverages the strengths of the companies while efficiently applying resources and reducing associated costs.

Dave Birsa, Chevron's exploration manager for Alaska, said the agreement reflects the two companies' compatible objectives in the Point Thomson area.

"It enables us to move more quickly on proposed exploration and development plans for the area, and it continues our focus in the eastern North Slope of Alaska, which is one of Chevron's targeted growth areas for North America," Birsa said.

Neil Ritson, head of exploration for BP Exploration Alaska, said the agreement continues a long-term business association based on a shared vision for exploring and developing in the eastern North Slope area.

"The sharing of technical resources will increase future opportunities in the Point Thomson area and allow Chevron and BP to maximize those opportunities," Ritson said.

Chevron and BP have worked together successfully in the eastern North Slope since 1984. In 1994, BP and Chevron drilled the Sourdough discovery, which was announced in 1997. More recently, the two companies jointly obtained 16 tracts in the Point Thomson area in Alaska State Lease Sale 86.

The Point Thomson area is about 40 miles east of Prudhoe Bay. The Point Thomson Unit is operated by Exxon Co. USA.

Updated: February 1998