press release

ChevronTexaco and Partners Sign Agbami FPSO Construction Contract

ABUJA, Feb. 22, 2005 -- Star Deep Water Petroleum Limited, an affiliate of ChevronTexaco Corporation today signed the agreement for the award of the contract for the construction of the Floating Production, Storage and Offloading (FPSO) vessel for Agbami Field to Daewoo Shipping and Marine Engineering (DSME) Corporation of South Korea. The Managing Director of ChevronTexaco Nigeria and Mid-Africa Business Unit, Mr. Jay Pryor, signed on behalf of the Agbami Unit while the President and Chief Executive Officer of DSME Mr. S. L. Jung signed on behalf of the contractor.

The signing of the $1.1 billion FPSO construction contract is a key milestone in the development of the Agbami field scheduled to come on stream in 2008 with a daily production of about 250,000 barrels of oil.

"We are excited by today's ceremony which represents for us, and our partners in the Agbami project, a major milestone in our efforts to bring the giant Agbami field into production on schedule. We are deeply appreciative of the tremendous amount of effort by all partners to get us to this point in our plan for the Agbami Field development," said Mr Pryor who also congratulated Daewoo Shipping and Marine Engineering (DSME) for winning the bid to build the FPSO for the Agbami Field.

In addition, Mr. Pryor said that the project will emphasize ChevronTexaco's core values in the area of Safety, Environmental Stewardship, Transparency, Local Content Development and Community Engagement. "We are aware that many people regard Agbami as remarkable for its reserves," Pryor noted, "but we want the project execution to show that it has more to offer Nigeria and its other stakeholders than production figures." In reference to the company's commitment to environmental stewardship, the MD added that "our goal is to leave very minimal impact on the environment as we produce the Agbami Field."

Engineer Kupolokun, the Group Managing Director of NNPC, said that with the signing of the FPSO construction contract, the country is again set to extend the frontiers of success in the industry and create further opportunities for growth and development for Nigeria. "Apart from the production and reserves addition that this project brings, it will also set the standard for Local Content participation in Nigeria's Deepwater Projects," he said. "We project that up to an astonishing 6,500 Tons of fabrication and 300,000 man-hours of engineering and services will be performed by Nigerians on this FPSO contract alone. This is significantly more than has ever been done on any Deepwater Project in Nigeria," Engineer Kupolokun added.

ChevronTexaco, through its affiliate – Star Deep Water Petroleum Limited is the operator of the Agbami Unit. Located in water depth of about 4,500 feet, the field straddles OMLs 127 and 128. Other partners in the project include Texaco Nigeria Outer Shelf Inc. (a ChevronTexaco affiliate), Petroleo Brasileiro Nigeria Limited, Statoil Nigeria Limited, Famfa Oil Limited and the NNPC. The Field is located about 70 kilometres offshore in the central area of the Niger Delta.

Updated: February 2005