Chevron 2016 Investor presentation November 2016 2016 Chevron Corporation
Key messages Financial priorities unchanged Cash flow growth Cost structure reset Capital to high return, short cycle 2016 Chevron Corporation 3
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 3Q16 YTD Low price environment Earnings (0.9) billion Responding to market 9.0 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*…
Spend reductions Total capital & exploratory OPEX and SG&A Quarterly Quarterly billions billions 12 YTD 2016 C&E is trending 8 below guidance range 10 YTD 2016 vs. YTD 2015: -32% 8 6 6 Cost structure reset YTD 2016 vs. YTD…
Reducing spend Total capital & exploratory OPEX / SG&A billions billions 40 30 25-28 guidance 17-22 guidance 4Q 20 4Q 15 3Q YTD 3Q YTD 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Actual Estimate Actual Estimate…
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 Uncertainties / timing 2.62 Divestments Price effects Spend levels 2015 2016 2017 2018 2019 2020 2016 Chevron…
December 2016 production Production MMBOED MCP growth 2.8 Gorgon Train 1 & 2 2.6 Growth ALNG TCO Bangka (Indonesia) 2.4 2.65 2.70 Alder (U.K.) MMBOED 2.2 Permian growth 2.0 Absence of Tengiz turnaround 3Q16 Dec 2016…
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 Public domain Divestment criteria Hawaii downstream 5.7 South Africa Non-strategic fit…
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 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…
Gorgon / Wheatstone Gorgon Wheatstone Train 1 All modules on site Rate stable at 110 MBOED* Train 1 first LNG expected mid-2017 17 cargos shipped to date Train 2 first LNG expected 6-8 months after Train 1 Train 2 Achieved first…
Chevrons approach to the Permian Advantaged Deliberate Competitive portfolio strategy performance 2 million net acres Disciplined growth to Efficient capital execution generate attractive returns 9 BBOE resource* Reliable, low…
Quality Permian acreage position Chevron acreage Chevron operated development Chevron non-operated development Acreage by NPV* 50k / acre 600,000 20k - 50k…
Permian unconventional performance Development improvements Competitive development costs /BOE Well performance (EUR) 20 Execution efficiencies 15 Supplier optimization 10 5 Operating improvements 0 Centralized maintenance…
Permian unconventional growth Positioned for value accretion Net production1 Midland & Delaware MBOED 400 Results continue ahead 350 of expectations 300 250 Accelerating growth 200 through end of decade 150 100 50…
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…
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 Well performance exceeding expectations production…
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…
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