press release

Chevron Announces It Is Proceeding With a Major Oil Field Development Project in the U.S. Gulf of Mexico's Ultradeep Water

Crude oil and natural gas to be produced from record-setting depth of 8,000 feet

SAN RAMON, Calif., Oct. 26, 2006 -- Chevron Corporation (NYSE: CVX) announced today that it will develop, with project co-owners, the Great White, Tobago and Silvertip fields in the U.S. Gulf of Mexico, approximately 200 miles south of Freeport, Texas. The fields will be produced via the Perdido Regional Development host (a direct vertical access spar tethered to the seabed). Perdido will be the deepest spar production facility in the world, moored in about 8,000 feet of water. First production from Perdido is expected around the turn of the decade, with the facility capable of handling 130,000 barrels of oil-equivalent per day.

The concept for regional development of several fields includes a common processing hub in Alaminos Canyon Block 857 near the Great White discovery that incorporates drilling and capabilities to gather, process and export production within a 30-mile radius of the facility. This concept will provide regional synergies, reduced costs and lower risks. It also will reduce the number and size of the facilities and operations in this challenging frontier area.

"This project adds to the already impressive list of opportunities and projects we are aggressively developing to bring new supplies to markets for consumers and to create additional value for our stockholders," said George Kirkland, executive vice president, Upstream and Gas, Chevron Corporation. "We are well positioned today to develop energy supplies that were not within our reach even 10 years ago. But at the same time, we are approaching these investment decisions with rigor to ensure we are maintaining a high degree of capital stewardship and control over costs."

Chevron is at the forefront of efforts to develop crude oil and natural gas from the Lower Tertiary play in the western deepwater Gulf of Mexico. Chevron operates two other fields that have been discovered in the Perdido area, Tiger and Trident, and owns interests in two exploration prospects, Whale and North Brontosaurus. Aside from participating in the Perdido Development in Alaminos Canyon, the company received worldwide coverage for its record-setting production test well at its Jack discovery in September 2006. The company also is developing the $3.5 billion Tahiti project in the Green Canyon area, which is expected to achieve first production in 2008. Chevron is the leading acreage holder in the Gulf of Mexico's deep water and in the Lower Tertiary region.

Chevron owns 37.5 percent of the Perdido Regional Host. It will be jointly owned by Shell, operator, with 35 percent and BP with 27.5 percent. Great White is located in Alaminos Canyon 812, 813, 814, 857, 900 and 901 and is owned by Shell, operator, with 33.34 percent, Chevron with 33.33 percent and BP with 33.33 percent.

Tobago is located in Alaminos Canyon 859 in approximately 9,600 feet of water. Chevron owns 57.5 percent along with its co-owners Shell, operator, with 32.5 percent and Nexen with 10 percent. The discovery well was drilled in 2004 to a total depth of 18,510 feet. A sidetrack well was drilled to 18,425 feet.

Silvertip, in Alaminos Canyon 815, is 60 percent owned by Chevron and operated by Shell with 40 percent interest. Chevron drilled the AC 815 No. 1 discovery well in August 2004 in approximately 9,200 feet of water to a total depth of 14,778 feet.

Chevron Corporation is one of the world's leading energy companies. With more than 53,000 employees, Chevron subsidiaries conduct business in approximately 180 countries around the world, producing and transporting crude oil and natural gas, and refining, marketing and distributing fuels and other energy products. Chevron is based in San Ramon, Calif. More information on Chevron is available at www.chevron.com.

CAUTIONARY STATEMENT RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.

Some of the items discussed in this press release include forward-looking statements about Chevron's activities in the U.S. Gulf of Mexico. Words such as "anticipates," "expects," "intends," "plans," "targets," "projects," "believes," "seeks," "estimates" and similar expressions are intended to identify such forward-looking statements. The statements are based upon management's current expectations, estimates and projections; are not guarantees of future performance; and are subject to certain risks, uncertainties and other factors, some of which are beyond the company's control and are difficult to predict. Among the factors that could cause actual results to differ materially are changes in demand for, and prices of, crude oil and natural gas, the results of drilling and testing, local political events, civil unrest, weather and general economic conditions. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Unless legally required, Chevron undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Updated: October 2006