press release

Sovcomflot and ChevronTexaco Sign Memorandum of Understanding

JOINT PRESS RELEASE

Issued locally in Moscow by ChevronTexaco Corp. and OAO Sovcomflot.

MOSCOW, 24 MAY, 2002 -- ChevronTexaco Corp., and OAO Sovcomflot today announced that they have signed a Memorandum of Understanding to further the joint activities of the two companies. The agreement was signed today within the framework of the meeting between Russian President Vladimir Putin and American President George Bush.

The scope of the companies' cooperative agreement includes a long term contract of affreightment, the transportation of a number of crude oil shipments from CPC using Sovcomflot tankers, technology transfer, participation in a variety of advanced training programs for employees from both companies, and a joint resolution of shipping safety issues.

At the signing ceremony Michael Carthew, president of ChevronTexaco Shipping Co., said, "I am excited about the opportunities arising from our two companies working together. Building on the knowledge and experience of these two respected shipping companies will not only generate new commercial prospects but will also provide a framework for finding ways to remain leaders in the areas of safety and environmental performance."

Dmitry Skarga, General Director of the OAO Sovcomflot, said "the signed memorandum is a dynamic follow-up on the U.S.-Russia Intergovernmental Agreement on Maritime Transport which was signed last year." The cooperation with ChevronTexaco is consistent with the strategic course taken by Sovcomflot towards a stepping up of the shipments of crude oil using Russian vessels." While working within the framework of the cooperation with ChevronTexaco, Sovcomflot will be operating cutting-edge 150-160,000 deadweight tankers that have been built for the company by the leading shipping yards in the last few years."

The start of the mutually beneficial cooperation between Sovcomflot and ChevronTexaco began earlier this year when the Caspian Pipeline Consortium (CPC) began loading the first OAO Sovcomflot tanker at the CPC marine terminal at Yuzhnaya Ozereevka near Novorossiysk.

In November 2001, ChevronTexaco and its partners celebrated the opening of a new oil export route from the Caspian region. This 1580-kilometer pipeline, built from the Tengiz field in western Kazakhstan to the Black Sea port of Novorossiysk, commenced tanker loading in October 2001. ChevronTexaco has a 15 percent interest in the $2.65 billion pipeline that will be able to carry up to a maximum of 28 million tons of crude a year in its initial phase.

About Sovcomflot

OAO Sovcomflot, a 100 percent state-owned company, is one of the biggest shipping companies in Russia. The company has a fleet of 70 various types of vessels with a total deadweight of 3 million tons, accounting for about 30 percent of all the Russian sea fleet. Sovcomflot fleet is among the youngest in the world, with an average age of a Sovcomflot vessel at nine years. The fleet includes tankers for crude and products, container, bulk, and timber carriers as well as passenger liners and others types of vessels.

About ChevronTexaco

ChevronTexaco Corp, headquartered in San Francisco, is the second largest energy company in the United States and the fifth largest in the world, based on market capitalization. More than 53,000 ChevronTexaco employees work in approximately 180 countries. The company is engaged in every aspect of the oil and gas industry, including exploration and production; refining, marketing and transportation; advanced energy; chemicals sales; and power generation.

Note to editors:

Equity interest in the Caspian Pipeline Consortium:

  • Russian Federation (24 percent)
  • Republic of Kazakhstan (19 percent)
  • The Sultanate of Oman (7 percent)
  • Chevron Caspian Pipeline Consortium Company (15 percent)
  • LUKARCO B.V. (12.5 percent)
  • Rosneft-Shell Caspian Ventures Limited (7.5 percent)
  • Mobil Caspian Pipeline Company (7.5 percent)
  • Agip International (N.A.) N.V. (2 percent)
  • BG Overseas Holdings Limited (2 percent)
  • Kazakhstan Pipeline Ventures L.L.C. (1.75 percent)
  • Oryx Caspian Pipeline L.L.C. (1.75 percent)

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 relating to the Memorandum of Understanding signed by ChevronTexaco Corp. and OAS Sovcomflot 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: May 2002