press release

ChevronTexaco Signs MOU to Bring LNG from Australia's Gorgon Gas Field to North America's West Coast

SAN RAMON, Calif., Aug. 4, 2003 -- ChevronTexaco Corp. today announced that an affiliate had signed a Memorandum of Understanding (MOU) with the Gorgon Joint Venture in Australia for the supply of Liquefied Natural Gas (LNG) for distribution to markets on the West Coast of North America.

Under terms of the MOU, a ChevronTexaco affiliate will enter into negotiations, the details of which are confidential, with the Gorgon Joint Venture which could lead to the supply of at least 2 million tonnes of LNG annually over a 20-year period, beginning in 2008.

The Gorgon gas field, located offshore Western Australia, has certified proven hydrocarbon reserves of 12.9 trillion cubic feet (Tcf), with total natural gas resources in the Greater Gorgon Area exceeding 40 Tcf. The Gorgon Joint Venture participants include ChevronTexaco (4/7th interest and operator), Shell (2/7th interest) and ExxonMobil (1/7th interest).

"Growing North American demand for natural gas is widely projected to outstrip supply capabilities," said John Gass, president of ChevronTexaco Global Gas, which coordinates the company's worldwide natural gas businesses. "The Gorgon Joint Venture is well positioned to help satisfy natural gas demand in both the West Coast of the United States and Mexico."

ChevronTexaco is currently seeking approvals to permit the construction and operation of an LNG terminal and regasification facility offshore Baja California which would be capable of receiving Gorgon LNG. "We believe the world-class Gorgon gas field and the significant natural gas resources in the Greater Gorgon area are ideally situated to meet growing demand in the Asia Pacific Basin," Gass said. "Development of these resources is a key element of our strategy to commercialize our equity resource base by targeting North American and Asian markets."

Separately, ChevronTexaco is currently engaged in permitting another LNG import terminal facility offshore Louisiana in the Gulf of Mexico, and is evaluating additional sites suitable for the importation of LNG to North America.

ChevronTexaco is one of the world's largest producers and marketers of natural gas, producing approximately 4.4 billion cubic feet of natural gas a day in countries including the United States, Australia, Angola, Denmark, Nigeria, the United Kingdom, Thailand, Trinidad, Canada, Colombia, Indonesia, Norway, Kazakhstan, Venezuela and the Philippines.

Note to Editors:

LNG is natural gas cooled into a liquid, occupying 1/600th the volume of an equivalent amount of natural gas. LNG shipment capacity is commonly expressed in tonnes; a metric tonne is equal to 1,000 kilograms or 2,204.6 pounds.

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

This news release contains forward-looking statements about the significance of the Memorandum of Understanding between ChevronTexaco Overseas Petroleum and the Gorgon Joint Venture. The statements are based on 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 are the terms and timing of a final agreement between the parties; the actual size of and production from the Gorgon Field; actual future North American demand for natural gas; alternative sources of natural gas supplies; the locations and timing of the construction of import, terminalling and degasification facilities for distribution to markets in North and Central America; local political events; and general economic conditions. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this 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.

U.S. Securities and Exchange Commission (SEC) rules permit oil and gas companies to disclose only proved reserves in their filings with the SEC. Certain terms, such as "certified proven hydrocarbon reserves" or "resource," are used in this press release that may not be permitted to be included in documents filed with the SEC.

Updated: August 2003