Chevron 2016 Investor presentation September 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, margin and returns Use strong balance sheet to complete projects under construction…
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 1 2 1 2 1 1 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 CVX ranking relative…
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 2Q16 YTD Low price environment Earnings (2.2) billion Responding to market 3.7 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*…
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 OPEX and SG&A Quarterly Quarterly billions billions 12 2016 C&E is trending 8 to lower end of 10 guidance range YTD 2016 vs. YTD 2015: -31% 8 6 OPEX reductions 6 continue to be…
Reducing spend Total capital & exploratory OPEX / SG&A billions billions 40 30 25-28 guidance 17-22 guidance 2H 20 2H 15 1H 1H 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Actual Estimate Actual Estimate Total…
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…
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 Proceeds Successful program billions (before tax) Ta r g e t Well-timed transactions 5 10 10 Captured good value Divestment criteria Public domain 5.7 Non-strategic fit Axis Title 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…
Upstream 2016 Chevron Corporation 17
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 2% 8% Canada…
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…
Gorgon / Wheatstone Gorgon (as of 2Q16 earnings call) Wheatstone Train 1 All 9 wells flow tested and ready for production Current rate 90 MBOED Plant structural, piping and cabling work Producing at 70% capacity currently ahead of…
Other 2016 start-ups Alder First production expected 2H 2016 Chuandongbei All three trains online Mafumeira Sul All four platforms installed Hook-up & commissioning ongoing First production expected 2H 2016 Angola LNG…
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…
Competitive Permian growth Advantaged acreage Midland & Delaware net acres3 (1000 acres) 2 MM acres Chevron 1 MM acres in Delaware Basin 0.5 MM acres in Midland Basin 85% no or low royalty 9 BBOE resource1 500 1000 1500 2000…
Competitive Permian growth Competitive development costs Average development cost1 /BOE Paced, efficient development of 20 prioritized queue 15 JV and industry best practices have 10 allowed accelerated learning 5 EUR…
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…
Jack / St. Malo Strong Stage 1 performance Total production (100%) MBOED Project delivered on time and on budget 8 wells online, and 1 more well expected in 2016 125 First year production Well performance exceeding expectations…
FGP / WPMP Final investment decision (FID) in July Wellhead Pressure Management Project Production profile (WPMP) Lower back-pressure on wells to maintain Start-up in 2022 the existing plants at full capacity FGP Future Growth…
FGP / WPMP financials Project cost Total: 36.8 B Facilities: 27.1 B Wells: 3.5 B Contingency / Escalation: 6.2 B 18/BOE project development cost Financing in place Accommodation building construction All figures shown are…
FGP / WPMP execution readiness Critical lessons learned incorporated into FGP / WPMP design and planning Increasing engineering Engineering 50% at FID; underground piping, electrical and maturity at FID foundations in 3D model; 85%…
FGP / WPMP Builds on previous successes Great partnership World class reservoir Proven technology Now is the time Reservoir pressure decline Capture market opportunities Project synergies Upside potential Future infill wells…
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…
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 201525 global fuels demand growth Compound annual growth rate MMBD 6 Premium Base Oil Petrochemicals* 4 Additives 2 Finished Lubricants Distillate…
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 (as of 2Q16 earnings call) 1,500 kMTA ethylene, Baytown, Texas 80% complete (6,000 people onsite) 1,000 kMTA polyethylene, Old Ocean, Texas Polyethylene reactors…
Loading...
