press release

Chevron Press Release - Chevron Chemical Restructures Petrochemicals Businesses

SAN RAMON, Calif., Dec. 15, 1995 -- Chevron Chemical Co. today announced it is restructuring to take better advantage of strengths in U. S. markets and increase the company's focus on developing international growth opportunities.

The former Aromatics and Olefins divisions, both headquartered in Houston, will be combined to form one U.S. Chemicals Division, to remain in Houston. A new International Group, eventually to be based in San Ramon, Calif., will help Chevron focus specifically on growth markets in key regions around the world. (Chevron Chemical's other major division, the Oronite Additives Division, based in San Ramon, already operates internationally and is unaffected by the reorganization.)

The U.S. Chemicals Division, the International Group and the Oronite Division will all report to Senior Vice President Darry Callahan.

The new U.S. division will be headed by Vice President and General Manager Ed Kura, 57, who formerly headed the Aromatics Division. George Scott, 61, who has served as Vice President and General Manager of the Olefins Division, earlier announced his retirement at the end of the year after 38 years of service.

The company also announced that Jim Lieto, 52, has been elected Vice President and General Manager of the Oronite Division, succeeding John Sanders, 60, who earlier announced his retirement after 37 years of service.

The manager of the new International Group also will be announced soon.

"On the U.S. side, we're taking steps that will help us achieve operational excellence, shifting our focus from a more functional orientation to one that is more strongly business oriented," said President John Peppercorn. "This is an important step in our quest to become the most efficient and reliable supplier. It also helps us by moving responsibility and accountability further into the organization where managers who are directly involved in running their businesses can have the most impact on profitability."

"On the international side," he continued, "there is strong potential for growing our core businesses in markets where we can take advantage of our know-how and technology. The new organization will help us focus on projects that can be developed into profitable businesses."

The new U.S. Chemicals Division will be structured by product lines, with six business managers reporting to Kura. Each business manager will be responsible for profitability, raw materials acquisition, manufacturing, marketing, supply and distribution, pricing, technology, and other aspects of running the business. Details about the new structure and management appointments will be announced soon.

The reorganization, with an emphasis on improving business effectiveness rather than on reducing the size of the workforce, is not expected to have a significant impact on the number of jobs in the company, but a few positions in Houston may be surplus as support services are combined from the Olefins and Aromatics divisions to the new U.S. Chemicals Division.

Peppercorn said the restructuring will be phased over a period of several months, which will minimize disruption of employees, and he pointed out that Chevron has an excellent track record of placing employees in other Chevron jobs whenever possible.

To help reduce the number of possible involuntary terminations from the reorganization, the company expects to have a voluntary severance program for some Houston-based employees, with details to be developed and released later.

Chevron Chemical's plants are not affected by the restructuring. However, their reporting relationships will change consistent with the business manager concept.

Chevron Chemical, with about 5,000 employees, is a $4 billion wholly owned subsidiary of San Francisco-based Chevron Corporation. Its main products are benzene, styrene, polystyrene, paraxylene, ethylene, polyethylene, normal alpha olefins and a variety of additives for fuels and lubricants. Chevron Chemical has plants in 10 states and in France, Brazil and Japan. With five foreign affiliates and 18 subsidiaries, it operates or markets in more than 80 countries.

Updated: December 1995