press release

CNOOC and ChevronTexaco Sign Agreement for Unitized Development of BZ25-1/25-1S Field in Bohai Bay


This is news concerning ChevronTexaco but issued by someone other than ChevronTexaco and archived here for record purposes.

BEIJING, People's Republic of China, Oct. 14, 2002 -- ChevronTexaco announced that its subsidiary Texaco China B.V. has entered into an agreement with China National Offshore Oil Corp. (CNOOC) to unitize the development of the BZ25-1/25-1S oil field in Bohai Bay, China. This is the first-ever unitization agreement between CNOOC and a foreign partner.

Because the BZ25-1/25-1S oil field straddles the boundary between two contract blocks, the agreement to unitize means that the project will now be developed under the "five-one principle" agreed upon by senior management of both companies, namely, one project, one operator, one management structure, one set of facilities, and one equity determination. Under the terms of the agreement, ChevronTexaco holds 16.2 percent participation interest in the entire unitized project. CNOOC owns the remaining 83.8 percent and will be the operator.

The BZ25-1/25-1S oil field is located about 150 kilometers (93 miles) southeast of Tanggu in Bohai Bay. The agreement covers a total area of 218 square kilometers (84 square miles).

"This first-ever unitization agreement for China marks another milepost in ChevronTexaco's long-standing, successful business relationship with CNOOC," said Sam Snyder, managing director of ChevronTexaco's China Business Unit. "Guided by the principle of mutually beneficial partnership, we have jointly created a highly efficient model for the commercial development of this field," he said.

The petroleum contract for Block 11/19 in Bohai Bay was signed in April 1992. The BZ25-1 oil field was discovered by ChevronTexaco via exploration of the block. Following an appraisal program, the field was redesignated BZ25-1S and determined to be an oil field straddling the boundary between Block 11/19 and the self-financed area of CNOOC.

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 that are based on management's current expectations, estimates and projections. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in these forward-looking statements. 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.

Updated: October 2002