Chevron 2016 Investor presentation June 2016 2016 Chevron Corporation
Key messages Maintain and grow dividend is the priority Improve free cash flow by: Reducing capital and operating spend Growing volume and margin Use strong balance sheet to complete projects under construction Positioned to…
Leading operational excellence performance Days away from work rate Oil spills to land or water Thousands of barrels 0.10 60 0.05 30 1 1 1 1 2 1 2 1 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 CVX ranking relative to…
Financial priorities Indexed dividend growth Basis: 2005 = 100 Maintain and grow dividend 300 9% compound annual Fund growth rate capital program 200 for future earnings Maintain 100 strong balance sheet Return surplus…
Financial performance 1Q16 Low price environment Earnings (0.7) billion Responding to market 1.1 billion Completing projects underway Cash flow from operations Capital and operating spend reduction Asset sales for value C&E…
Improving free cash flow Cash flow after dividends* (including asset sales) billions 10 TCO Cash flow from operations DS&C/ financing/ Reduced spend asset sales 5 Upstream Other Price 0 recovery Further flexibility 2017*…
Reducing spend Total capital & exploratory OPEX / SG&A billions billions 40 30 25-28 guidance 17-22 guidance 20 15 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Projects under TCO FGP/ WPMP Base & other construction…
Cost and procurement activities Sustainable actions Examples of efficiency gains Organizational activities Thailand drilling efficiency Average days per 10,000 feet drilled Rushmore benchmarking 4,000 through 1Q 2016 On target to…
Spend momentum Total capital & exploratory spend OPEX / SG&A Rolling four-quarter average Rolling four-quarter average billions Responsive to billions 12 market conditions 8 C&E lower by -19%* 2014 Opex decline by -6%* 2014 2015…
Growing upstream volume Projected net production Growth MMBOED Major capital projects online Shale and tight 0-4% Uncertainties / timing growth* 2.62 Divestments Price effects Spend levels 2015 2016 2017 2018 2019 2020…
Growing upstream margin Projected cash margin* per BOE 30 New barrels accretive 70/bbl Divestment of 20 60/bbl lower margin barrels 52/bbl 52/bbl Expansion strongly linked 10 to oil prices 2015 2017 *Estimated after-tax…
Asset sales program In public domain asset sales 2016 2017 target 5 -10 billion Western Canada gas storage facilities Divestment criteria KLM pipeline Receive fair value Myanmar Gulf of Mexico shelf Non-strategic fit Hawaii…
Strong balance sheet Reported annual debt ratio and debt capacity Debt ratio 70% 50% TOT 30% BP RDS (Post-BG) XOM 10% -20 -10 10 20 30 40 Debt capacity: incremental debt capacity to 30% debt ratio ( billions) Others:…
Pathway to improve returns Adjusted ROCE Lower pre-productive capital from long- Percent cycle projects 15 More high return, short-cycle and brownfield spend Project execution improvements 10 Lower unit operating expense…
Shorter-cycle, higher return investments Total capital & exploratory Spend profile Percentage of capital program Increase in shale and tight More brownfield opportunities Fewer major capital projects Reduced execution risk…
Oil price exposure World liquid fuels production and consumption MMBD 98 3.0 90% 2.0 capital weighted Gas to upstream 92 1.0 LNG 0.0 75 % Oil Oil upstream production 86 (1.0) weighted to oil price 1Q12 1Q13 1Q14 1Q15…
Upstream 2016 Chevron Corporation 18
Upstream portfolio Strategically positioned geography Strong, flexible portfolio Percent of total commercial reserve portfolio World class legacy assets Premier shale positions 7% 12% 0% 12% Outstanding mature assets Canada 2% 8%…
Strong reserves performance 5 year reserve replacement BBOE Reserve Additions 11.2 replacement ratio 10.5 Production 107 % Asset 1 year sales (4.8) (0.2) 5.6 113% 5 year 2010 2015 Numbers do not add due to…
Leading exploration performance 1.8 BBOE 62 % 1.22 Discovery costs 20052014 Resource* adds Success rate Unit finding cost /BOE in 2015 in 2015 in 2015 4 3 2015 2 Resource additions 1 11.3 BBOE 57 % 1.73 Resource* adds…
Improving efficiency Deepwater Gulf of Mexico Tengiz Technology Intelligent well completions New well stimulation method 30% production increase from enhance economic recovery reduced costs 70% artificial intelligence Basin…
Jack / St. Malo Strong stage 1 performance Total production (100%) MBOED Project delivered on time and on budget 6 wells online, with 3 more wells in 2016 125 First year Well performance meeting expectations production ramp-up…
Gorgon First production and cargo in March Reached rate 90 MBOED Repairs completed and restart activities underway Train 1 ramp-up and Trains 2 & 3 start-up timing per prior guidance 2016 Chevron Corporation 25
Wheatstone Progress 2016 key milestones All train 1 modules required for start-up set on All wells ready for production foundations Platform fully commissioned 14 of 24 Train 2 modules delivered Gas turbine generators online LNG…
Other 2016 start-ups Alder First production expected 2H 2016 Chuandongbei Trains 1 and 2 online Expect Train 3 start-up Mafumeira Sul in 2Q 2016 All four platforms installed Hook-up & commissioning ongoing First production…
Other projects in execution Big Foot Tension Leg Platform design validated Platform in storm-safe storage Start-up expected 2H 2018 Other start-ups Sonam 2017 Hebron 2017 Clair Ridge 2017 Stampede 2018 NOJV project…
Attractive Permian growth Large, quality resource Net production Midland & Delaware Basins MBOED 2 MM net acres 400 9 BBOE resource* 85% no or low royalty 350 300 Efficient development plans 250 Factory mode with multi-well…
Competitive Permian performance Lowering development costs Drilling days per well Horizontal well costs reduced 40% 50 Drilling footage per day increased 45% 40 50% reduction 30 Frac stages per day increased 115% 20 10 Recent…
Leveraging Permian performance to other shale & tight assets Duvernay Vaca Muerta Appalachia Appraisal program advancing Initiated horizontal factory mode Pacing investment Best-in-class drilling; days per Horizontal well costs…
Base projects Well factories Base deepwater Asset enhancements Gulf of Thailand Focused on development of Infill drilling San Joaquin Valley existing assets Debottlenecking and Indonesia Agbami, Tahiti, Jack / St. Malo, reliability…
Tengiz FGP / WPMP Project has two components WPMP provides additional wells and pressure boost facilities to fill existing plant capacity FGP adds wells and new plant capacity of 250300 MBOPD (100%) FID expected mid-2016…
Applying project lessons learned to FGP / WPMP Increasing engineering Engineering 40% complete; all underground piping, electrical and maturity at FID foundations in 3D model Strengthening design Process design, equipment sizing &…
Future opportunity queue Liard Basin Horn River Basin Rosebank Captain EOR Kitimat Duvernay LNG Marcellus TCO FGP/WPMP Utica Kurdistan Tahiti Vertical Expansion Region of Iraq Midland & Tahiti Upper Sands Development Delaware…
Downstream portfolio Fuels refining & marketing Portfolio Chemicals Integrated value chains 2015 capital employed Cost advantaged, globally positioned 35% 65% 2018 capital employed 42% 58% Chemicals & lubricants…
Strategy focused on competitive returns Deliver competitive returns and grow earnings across the value chain Improve operational excellence Grow higher return segments Petrochemicals Lubricants and additives Focused refining and…
Demand growth points to attractive segments 201525 global product demand growth 2015-25 global fuels demand growth Compound annual growth rate MMBD 6 Premium Base Oil Petrochemicals* 4 Additives 2 Finished Lubricants…
Impact of lifting the U.S. crude export ban Levels the playing field 2015 U.S. crude capacity by region U.S. light-sweet crude gets global parity pricing 100% U.S. heavy coking margins improve relative to U.S. light cracking…
Chevron Phillips Chemical USGC petrochemicals project Overview Progress 1,500 kMTA ethylene, Baytown, Texas 75% complete (6,000 people onsite) 1,000 kMTA polyethylene, Old Ocean, Texas Polyethylene reactors in-place 500 kMTA HDPE…
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