press release

ChevronTexaco Sells 150 U.S. Producing Properties to XTO Energy Inc.

SAN RAMON, Calif., May 17, 2004 -- ChevronTexaco Corp. today announced that its North America Exploration and Production Co. has sold a package of 150 onshore producing properties to XTO Energy Inc. (NYSE-XTO) for $1.1 billion. The properties are located in seven states, with more than 90 percent of current production in Texas and New Mexico. The company expects to record a significant gain to income upon close of the sale, which is anticipated in the third quarter of this year.

The sale is part of plans announced in 2003 to improve the competitive performance of the company's upstream portfolio through the divestment of nonstrategic assets and the realignment of strategic business units. To date, the company has reached agreement to sell approximately two-thirds of production targeted for sale in ChevronTexaco's ongoing U.S. divestment program.

ChevronTexaco Vice Chairman Peter Robertson said: "This sale is significant. It is a key step in our drive to streamline our portfolio of assets to approximately 400 core fields that represent the vast majority of our long-term value in the United States and Canada. Furthermore, the transaction allows us to focus on maximizing and growing the value of our base business."

Ray Wilcox, vice president of ChevronTexaco and president of ChevronTexaco Exploration and Production Co., added that ChevronTexaco will continue to strengthen its North America portfolio, which is built on strong positions in strategic oil and gas regions. "We're the No. 1 producer in California and the Gulf of Mexico Shelf, the No. 2 producer in the Permian Basin, and the No. 3 natural gas producer in the United States. The sale allows us to focus our resources on core properties and future opportunities that can add the most value to ChevronTexaco stockholders."

Currently celebrating its 125th anniversary, ChevronTexaco is the second-largest U.S.-based energy company and the fifth largest in the world based on market capitalization. More than 50,000 ChevronTexaco employees work in approximately 180 countries around the world, producing and transporting crude oil and natural gas, and marketing and distributing fuels and other energy products. ChevronTexaco is based in San Ramon, Calif.

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

Some of the items discussed in this press release are forward-looking statements about the sale of a package of 150 U.S. onshore producing properties and the company's North America crude oil and natural gas asset portfolio optimization strategy. The statements are based upon management's current expectations, estimates, and projections; are not guarantees of future performance; and are subject to certain risks, uncertainties and other factors, some of which are beyond the company's control and are difficult to predict. Among the factors that could cause actual results to differ materially include the ability of the company to divest nonstrategic assets and realign business units according to plan, failure of the sale of the package of 150 producing properties to close according to expectations, the final sales price for the properties, the exercise of a preferential right by third parties, and general economic conditions. You should not place undue reliance on these forward-looking statements, which speak only as of the date of the press release. Unless legally required, ChevronTexaco undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Updated: May 2004