press release

Chevron Press Release - Chevron Offshore Thailand Announces Promising Oil & Gas Discovery

BANGKOK, Dec. 28, 1999 -- Chevron Offshore (Thailand) Ltd. announced the discovery of potentially significant hydrocarbon deposits in the Jarmjuree area of Block B8/32 in the Gulf of Thailand.

Several successful drilling tests in the northern sector of approximately 1,200-square-kilometer Jarmjuree area helped prove the potential reserves, including approximately 200 feet of net pay from this most recent discovery, and has prompted Chevron to increase exploration activities in 2000. Chevron, on behalf of Block B8/32 participants, also will apply for a production license area (PLA) to develop these reserves.

"This latest in a series of successful drilling tests will greatly help Chevron map out development for the Jarmjuree area," said George Mattingly, Chevron Thailand's asset manager. "We are optimistic as the results show favorable conditions for commercial production. Chevron will follow these encouraging results in north Jarmjuree with an aggressive exploration program in the area's other sectors, starting early in 2000."

Given this confirmation of significant reserves in the north Jarmjuree area, Chevron is applying for a PLA. The company will submit the PLA application, on behalf of Block B8/32 participants, in the next several weeks. Chevron hopes to get approval from the Department of Mineral Resources and the Ministry of Industry by mid-2000. The Jarmjuree discovery will also complement Chevron's capital investment planned for the neighboring Maliwan area.

"This discovery further reinforces Chevron's long-term commitment to investing here," said Jay Pryor, managing director for Chevron Offshore Thailand. "We are highly focused on bringing the production of oil and gas from Block B8/32 on-stream. This development of Thailand's natural resources will add to the Kingdom's energy self-sufficiency, reduce the need to import oil, and help strengthen Thailand's economy. It will help the country's economic growth and also create more jobs both in gas producer and end user's sectors."

According to Pryor, this year's good results are a strong foundation for Chevron's forward exploration program for 2000 and beyond. "If the wellhead gas price is in the range of $2.25 to $2.75 per MMBTU, we are confident of fully developing our potential resources."

Chevron is known for its long-term participation in regional growth opportunities. Founded in San Francisco 120 years ago, Chevron is credited with discovering oil in Saudi Arabia in the 1930's and was the pioneering Western company in Kazakhstan, where it operates the Tengiz oil field, with reserves estimated between 6 and 9 billion barrels of recoverable oil. Chevron is today active in nearly 100 countries.

A half-owner of Caltex Petroleum Corp., which is active in refining and marketing in 18 Asian nations, Chevron's Asian exploration and development roots began with the discovery of oil in Indonesia 60 years ago. The company is today seeking additional exploration and development opportunities throughout the Pacific Rim.

Chevron's interest in Block B8/32, about 125 miles offshore, was acquired following its purchase of Rutherford Moran earlier this year. It contains three known fields: Tantawan, Benchamas and Maliwan.

Chevron's wholly owned subsidiary, Chevron Offshore (Thailand) Ltd., holds 51.66 percent interest in the block, and other partners are Thaipo, a subsidiary of U.S-based Pogo Producing Co. (46.34 percent) and Bangkok-based Palang Sophon (2 percent).

Updated: December 1999