press release

Chevron Press Release - CITC Announces New Strategic Direction To Increase Ties To Chevron's Core Oil

SAN RAMON, Calif., Feb. 3, 1997 - Chevron Information Technology Company (CITC) today announced that it is adopting a strategic direction that will result in a fundamentally new company. The new CITC will focus on providing a common global network computing environment for the corporation and on developing custom information technology services to yield a competitive advantage for Chevron's core operations in oil and gas exploration, production, refining and marketing.

A new management structure reflecting the repositioning of the company, including the appointment of D. M. (Dave) Clementz as CITC's president effective Feb. 15, is part of the overall plan. The company expects to see a $50 million annual reduction in costs once all facets of the redirection are in place.

CITC currently has about 1,660 employees. Two hundred employees from other Chevron companies providing similar services will be moved into the new organization, consolidating personnel and equipment.

Approximately 100 positions will be eliminated in the first phase of the plan, which is expected to be completed by April 1. During 1998, approximately 500 additional positions will be eliminated as operations are streamlined, outsourced or discontinued. By the end of 1998, CITC expects to have about 1,200 employees.

"CITC will manage Chevron's computing environment by using the most innovative methods available from both inside and outside the company, and providing critical expertise in the information technology required by our core oil and gas businesses," said D. L. (Don) Paul, Chevron Corporation vice president of technology.

"In addition, CITC will offer a competitive advantage to Chevron companies by furnishing services that are directly linked to our strategic business intents."

CITC will be divided into two business lines: "shared," or those activities required and supported by the corporation, such as a common computing environment; and "custom," or those technologies that help individual Chevron operating companies meet specific business objectives.

Strategic partnering, whereby CITC manages contracts with companies that provide specialized and cost-efficient services, such as telephone communications, will become an integral part of CITC's corporate-wide operations. CITC will outsource all mainframe and telecommunications operations by early 1998. Other opportunities to outsource will be evaluated based upon where there is a strategic fit with Chevron's needs.

Clementz, 51, currently serves as president of Chevron Petroleum Technology Company and will succeed W. T. (Bill) Houghton, who is retiring.

CITC is a wholly owned subsidiary of San Francisco-based Chevron Corporation.

Updated: February 1997