press release

Chevron Press Release - Chevron Commits to LNG Expansion Project In Western Australia

SAN FRANCISCO, April 1, 2001 -- Chevron Australia Pty Ltd., a subsidiary of Chevron Corp. and a participant in the North West Shelf Venture (NWSV), today announced it will participate in a $1.6 billion expansion of the NWSV liquefied natural gas (LNG) project near Karratha, Western Australia.

The LNG Expansion Project by the NWSV will encompass three major segments:

  • Construction of a fourth LNG train with an annual capacity to process 4.2 million metric tonnes, equivalent to 500 mmscfd;
  • Development of an 80 mile (130 kilometer), 42-inch pipeline to shore from the NWSV-operated offshore gas fields;
  • The design and construction of the Venture's ninth LNG carrier.

The NWSV will invest approximately $892 million in the LNG processing and associated infrastructure expansion, with additional investments of $522 million for the pipeline and $165 million for the LNG carrier. Construction of the fourth LNG train is expected to begin in September this year and to be on stream by mid-2004.

"The decision to participate in this expansion project is evidence of Chevron's ongoing commitment to its business growth in the region through the monetisation of its vast gas resources," said Peter Robertson, president of Chevron Overseas Petroleum Inc.

Today's approval of the project by the government of Western Australia paves the way for the award of construction contracts for the LNG facility. Contracts have already been awarded to Western Australian companies for preliminary site work that began in late January. A ship tender process was recently completed for the LNG carrier that will be built in Korea by Daewoo Shipbuilding and Marine Engineering for delivery in 2004.

"The NWS expansion project will be one of the biggest industrial projects ever undertaken in Australia," said Keli Taureka of Chevron Australia Pty Ltd. "We believe it will provide significant economic benefits both to the Pilbara region in Western Australia, and the entire country. It also supports and exemplifies Chevron's growth in the global LNG market and facilitates further domestic gas opportunities in Australia." Independent studies estimate the project will support about 9,000 jobs during the construction phase between 2001-2004.

"The NWS participants' aggressive strategy will not only increase LNG production in a key market, but will also strengthen Australia's economy by increasing the supply of environmentally clean energy to Japan and other Pacific Rim customers," said Taureka. "Chevron Australia plays an integral part in the development of NWS gas resources and we are eager to support our joint venture partners in producing those resources in the safest, most cost-effective manner to realize maximum benefits for the partners, the Australian government and the Australian community."

Chevron is the largest holder of gas reserves in Western Australia through its interests in the NWS Project and its operatorship of the massive Greater Gorgon Area gas fields.

Participants in the North West Shelf Venture, each of whom hold equal interest, are: Woodside Energy Ltd. (operator); Chevron Australia Pty Ltd.; BHP Petroleum (North West Shelf) Pty Ltd.; BP Developments Australia Pty Ltd.; Japan Australia LNG (MIMI) Pty Ltd.; and Shell Development (Australia) Proprietary Ltd.

Note to editors: All figures are U.S. dollars.

Cautionary Statement Relevant to Forward-Looking Informationfor the Purpose of "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995

Some of the items discussed in this release are forward-looking statements relating to Chevron's operations that are based on management's current expectations, estimates and projections. The statements included in this release are not guarantees of actual outcomes or future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. These include potential changes to work plans, the availability of funds, or construction schedules. Actual outcomes and results could differ materially from what is expressed or forecasted in these forward-looking statements. The reference in this release to Chevron as "the largest holder of gas reserves in Western Australia" is based on reserve quantities that are not limited to "proved reserves." This is in contrast to reporting and discussions of reserve quantities in filings with the Securities and Exchange Commission (SEC). Reporting and discussions of reserve quantities in filings with the SEC is limited to "proved reserve" -- quantities of oil and gas reserves that the company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. Ultimate recovery of oil and gas quantities could differ materially from estimates.

Updated: April 2001