press release

Chevron Press Release - Chevron, Partners Celebrate First Oil From Banzala Field Offshore angola

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SAN FRANCISCO, July 28, 1999 -- Moving closer to its self-imposed challenge of boosting oil production from Chevron-led Angolan fields to 600,000 barrels per day (bpd) by the year 2001, Chevron today announced it has begun crude oil production from the Banzala oil field, located 12 miles offshore Cabinda province in the Block O concession.

"Banzala represents the latest in a series of successful Chevron-led developments offshore Angola, and brings us one step closer to meeting our 600,000-barrel-per-day challenge," said Dick Matzke, a director of Chevron Corp. and president of Chevron Overseas Petroleum Inc.

Matzke praised the project team for bringing Banzala onstream just 18 months after contracts were awarded.

"Not only was this challenging project brought onstream on time, but it was also achieved under budget," said Mark Puckett, managing director of Cabinda Gulf Oil Co. (CABGOC), the unit of Chevron which serves as operator for the consortium developing Block O. "The complexity of this field required drilling high-angle, extended-reach wells in order to produce the oil. Then, electric submersible pumps fitted onto coiled tubing had to be installed -- all technological firsts in Angolan oil operations," added Puckett.

Production from the first three Banzala wells is expected to reach about 7,500 bpd by month's end. In the initial development phase, five additional wells will be brought onto production later this year, increasing output to 25,000 bpd. Banzala crude is sent via pipeline to CABGOC's Malongo terminal.

A Phase 2 pilot project that would require drilling another five wells is being planned, and could be on production as early as the first quarter of 2000.

With the addition of production from Banzala's initial development phase, total Chevron-led production in Angola's Block O -- currently averaging 480,000 bpd -- is expected to reach an average of 500,000 bpd by year end.

Note to Editors:

Chevron (operator) holds 39.2 percent interest in Block O; Sociedade Nacional de Combustiveis de Angola (SONANGOL), the national oil company, has a 41-percent interest; Elf Petroleum Angola has 10 percent; and AGIP Angola Ltd. holds the remaining 9.8-percent interest.

Updated: July 1999