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June 2018 Investor Presentation – Chevron Corp

Chevron Corp · Jun 15, 2018 · 65 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. June 2018 Investor Presentation – Chevron Corp – slide 1
    Chevron 2018 Investor Presentation June 2018 2018 Chevron Corporation
  2. June 2018 Investor Presentation – Chevron Corp – slide 2
    Operational excellence leadership Days away from work rate1 Oil spills to land or water3 Thousands of barrels 0.10 40 30 0.05 Industry leading 20 1 1 1 safety and spill 10 1 1 1 2014 2015 2016 2017 performance 2014 2015 2016…
  3. June 2018 Investor Presentation – Chevron Corp – slide 3
    Macro landscape Global crude oil supply & demand1 Million barrels per day 100 Supply gap of 42 mmbd Demand in IEA NPS 80 60 Demand growth and production 40 declines lead to supply gap 20 2020 2030 2040 Global liquid…
  4. June 2018 Investor Presentation – Chevron Corp – slide 4
    1Q 2018 results Cash flow Cash flow from operations excluding working capital* 7.1B Capital Capital & exploratory expenditures 4.4B Production 2.85 MMBOED (up 4.5%) Permian 252 MBOED (up 100 MBOED) Dividend Increased…
  5. June 2018 Investor Presentation – Chevron Corp – slide 5
    2018 cash flow Cash flow from operations Free cash flow excluding working capital1 excluding working capital1,2 billions billions 8 4 Cash flow growth 6 2 4 Delivering 2018 cash generation in line 0 2 with guidance…
  6. June 2018 Investor Presentation – Chevron Corp – slide 6
    Working capital Historical change in working capital1,2 billions 2 Consistent pattern 0.9 0.4 0 (0.2) (1.2) Mostly transient -2 1Q 2Q 3Q 4Q 1 Average quarterly working capital change for 2010-2017. 2 1Q2017 has…
  7. June 2018 Investor Presentation – Chevron Corp – slide 7
    2018 cash generation 2018 cash flow billions 18 16 14 Cash generation 12 of 14B 10 8 2018 cash flow 6 Dividend breakeven 50/bbl 4 Dividend without asset sales 2 2017 CF CF sensitivity 2018 2018 2018 CF after after…
  8. June 2018 Investor Presentation – Chevron Corp – slide 8
    Winning in any environment What we have What we will do What investors get Grow Be Advantaged production returns-driven Superior total portfolio and cash in capital shareholder return margins allocation Sustainable Free cash…
  9. June 2018 Investor Presentation – Chevron Corp – slide 9
    Profitable downstream & chemicals portfolio Focused portfolio Technology Integrated enabled value chains formulations TCO Advantaged Complex feed, scale and refineries with technology scale Strong brands and leading…
  10. June 2018 Investor Presentation – Chevron Corp – slide 10
    Advantaged upstream portfolio Diverse Opportunities Sustainable to high-grade TCO and long-lived San Joaquin Valley Permian Deepwater Gulf of Mexico Nigeria Gorgon Wheatstone Lower risk Low cost High margin /…
  11. June 2018 Investor Presentation – Chevron Corp – slide 11
    Sustainable portfolio Reserves to production ratio1 Resource to production ratio2,3 Years Years 18 40 Prudent and stable 15 reserves to production 30 20 Long-lived 12 resource base 10 9 2012 2013 2014 2015 2016…
  12. June 2018 Investor Presentation – Chevron Corp – slide 12
    Strong balance sheet Debt ratio1 Percent 60 55 50 45 40 BP 35 TOT 30 RDS 25 20 XOM 15 BBB A AA Credit rating2 Other companies included: APC, COP, DVN, EOG, ENI, HES, MRO, OXY, STO, SU 1 Debt ratio = ((total debt) /…
  13. June 2018 Investor Presentation – Chevron Corp – slide 13
    Disciplined C&E program Total capital & exploratory* 2018 capital & exploratory budget billions billions 45 40 18.3 35 30 25 1820 20 18.8 18.3 75% of spend 15 delivers cash 10 flow within Cash 2 years 5 C&E 12.8 2014 2015…
  14. June 2018 Investor Presentation – Chevron Corp – slide 14
    Cost reductions continue Production costs1 Corporate cost reduction /BOE from 20142 18 Percent -12 16 Cost reductions 14 continue -18 12 Technology enables increased efficiencies 10 8 2014 2015 2016 2017 2020 -24…
  15. June 2018 Investor Presentation – Chevron Corp – slide 15
    Upstream cash margin grows Projected operating Liquid % of total production2 cash margin1 Percent /BOE 28 85 Increase high margin, 75% oil-linked volume CVX oil-linked production3 70/bbl 75 24 65 Divest lower margin barrels…
  16. June 2018 Investor Presentation – Chevron Corp – slide 16
    Worldwide net oil & gas production Net production MBOED 3,000 4 - 7% growth* 2018 growth drivers: without 2018 asset sales Wheatstone Train 2 start-up 2,800 Major capital project ramp-ups 2,728 2,852 Shale & tight growth…
  17. June 2018 Investor Presentation – Chevron Corp – slide 17
    Production growth at low C&E Projected net production at 60/bbl MMBOED Base1 plus shale & tight 23% CAGR through 2022 with 910B capital spend/yr2 4-7% growth 5% growth 2.73 Uncertainties 2.59 Price effects Status of PZ…
  18. June 2018 Investor Presentation – Chevron Corp – slide 18
    Continuous portfolio review Upstream assets1 Investments San Joaquin Valley High margin, high return Scale, efficiency Mature2 Divestments Nigeria Kazakhstan Non-strategic fit Cant compete for capital Receive good…
  19. June 2018 Investor Presentation – Chevron Corp – slide 19
    Improving cash returns CFFO ROCE1 at 60/bbl Free cash flow growth3 20172020 CAGR % 20172020 Percent 40 Price 16 Portfolio upside Expanding cash margins enhancement 30 Cost & other 14 Margin & volume Lower cost structure…
  20. June 2018 Investor Presentation – Chevron Corp – slide 20
    Shareholder distributions Indexed dividend growth* Basis 2007 = 100 200 7% CVX compound annual growth rate 150 100 A leader in 50 2007 2017 dividend growth Chevron S&P 500 Competitor average: BP, RDS, TOT, XOM Percent…
  21. June 2018 Investor Presentation – Chevron Corp – slide 21
    Consistent financial priorities 20182020 guidance* Maintain and grow dividend Competitive dividend growth Fund capital program Annual C&E range 1820B Strong balance sheet Debt ratio 20% Return surplus cash Resume buy…
  22. June 2018 Investor Presentation – Chevron Corp – slide 22
    Headlines Guidance through 2020: Shale & tight resource Annual C&E 1820B Increases to 17.5 BBOE Asset sale proceeds 510B Upstream cash margin Permian unconventional: grows 12/bbl Acreage increases to Cash flow sensitivity 450…
  23. June 2018 Investor Presentation – Chevron Corp – slide 23
    Upstream 2018 Chevron Corporation
  24. June 2018 Investor Presentation – Chevron Corp – slide 24
    Advantaged portfolio Unit resource value* /BOE Diverse 5 Sustainable and long-lived 4 Low cost 3 High margin / oil-linked 2 1 Lower risk Opportunities to high-grade Competitors: BP, RDS, TOT, XOM Source: Wood…
  25. June 2018 Investor Presentation – Chevron Corp – slide 25
    Diverse upstream portfolio Geography Asset class Resources New infrastructure 69 BBOE of 6P resource* TCO San Joaquin Heavy oil LNG Valley Deepwater Gulf of Permian Mexico Deepwater Shale & tight Nigeria Gorgon…
  26. June 2018 Investor Presentation – Chevron Corp – slide 26
    Sustainable resources Reserves1 Resources2 5-year reserve replacement: 107% 10-year resource replenishment: 171% BBOE BBOE 24.5 69.0 11.3 5.4 11.7 Replacing reserves while 62.1 growing production (4.8) (0.3) (9.6) 2012…
  27. June 2018 Investor Presentation – Chevron Corp – slide 27
    Sustainable production Base and shale & tight net production1 23% CAGR Short-cycle investments Low execution & subsurface risk 910 billion annual capital spend1 2018 2019 2020 2021 2022 Shale & tight Base excluding MCPs2…
  28. June 2018 Investor Presentation – Chevron Corp – slide 28
    Growing Permian value Quality position Unconventional acreage by NPV3 2.2 million net acres1 80% no or low royalty Increased resource 20% to 11.2 BBOE2 50k /acre 800,000 Portfolio value…
  29. June 2018 Investor Presentation – Chevron Corp – slide 29
    Strong Permian performance Development & production costs1 Well performance2 /BOE Delaware Basin3 Normalized Cum. Prod. (MBOE) 30 Chevron wells Delivering competitive 20 performance Competitor wells 0 2 4 6 8 10 12 Months Midland…
  30. June 2018 Investor Presentation – Chevron Corp – slide 30
    Permian unconventional production Midland and Delaware Basin* Net MBOED 800 700 1Q production 252 MBOED up 100 600 MBOED from 1Q 2017 500 400 300 Operating 18 rigs 200 100 Transacted 25,000 acres for value 2015 2016 2017 2018 2019 2020…
  31. June 2018 Investor Presentation – Chevron Corp – slide 31
    Winning in the Permian Upstream Midstream Downstream Advantaged Optimize the value Market portfolio and of every barrel knowledge growing production and exposure Batching and blending Export capabilities 2018 Chevron…
  32. June 2018 Investor Presentation – Chevron Corp – slide 32
    Expanding shale & tight activities Applying learnings across multiple assets Duvernay1 Vaca Muerta (Loma Campana)3 Appalachia4 EUR2 per well increased 40% EUR2 per well increased 100% EUR2 per well projected to Unit development cost…
  33. June 2018 Investor Presentation – Chevron Corp – slide 33
    Accelerating Delivering Ca gas Australian 1Q18 activity Gorgon 202 MBOED1 Wheatstone 67 MBOED1 Monetizing Shipped 69 LNG cargos2 Shipped 4 condensate cargos2 50 TCF of resource4 Gorgon & Wheatstone 5 trains expected to…
  34. June 2018 Investor Presentation – Chevron Corp – slide 34
    Developing Tengiz Base business FGP / WPMP3 Strong earnings and cash flow On track for first production in 2022 Reliability of 98%1 FGP adds 260 MBOED capacity and increases production to 1 MMBOED4 Net production grew by 17% since…
  35. June 2018 Investor Presentation – Chevron Corp – slide 35
    Active Gulf of Mexico Chevron deepwater assets Leveraging installed infrastructure Jack / St. Malo, Tahiti, Blind Faith Petronius and others Extending tie-back radius through Ballymore Blind technology Tubular Faith Shelf…
  36. June 2018 Investor Presentation – Chevron Corp – slide 36
    Improving deepwater value Efficiencies Technology Standardization Reduced completion time1 40%2 Extending subsea tie-back reach Subsea trees, equipment, Reduced unit operating cost Real-time reservoir management topsides and floating…
  37. June 2018 Investor Presentation – Chevron Corp – slide 37
    Downstream & Chemicals 2018 Chevron Corporation
  38. June 2018 Investor Presentation – Chevron Corp – slide 38
    Profitable downstream & chemicals portfolio Fuels refining & marketing Petrochemicals Lubricants & additives Focused, regional optimization Advantaged feed, scale and technology Strategic positions serving global markets Refinery…
  39. June 2018 Investor Presentation – Chevron Corp – slide 39
    Strategy focused on leading returns World-class operational excellence Grow earnings across the value chain Target investments Lead the industry in returns 2018 Chevron Corporation 40
  40. June 2018 Investor Presentation – Chevron Corp – slide 40
    Financial performance Reported earnings Adjusted earnings per barrel* billions /bbl 10 6 1 2.89 5 3 1 1 1 2 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 10.5% 15.3% 24.8% 13.0% 14.1% Adjusted ROCE* CVX ranking…
  41. June 2018 Investor Presentation – Chevron Corp – slide 41
    Integrated fuels value chains U.S. West Coast U.S. Gulf Coast Asia Pacific 1 brand share in Western U.S. Leading brand in Central America Long-standing partnerships Mexico retail market entry Top net cash margin refinery World-class…
  42. June 2018 Investor Presentation – Chevron Corp – slide 42
    Major capital projects Evaluation / FEED Under construction Commission / start-up GS Caltex Richmond refinery ChevronPhillips Chemical Co. Mixed feed cracker olefins project Modernization USGC petrochemicals project Oronite Salt…
  43. June 2018 Investor Presentation – Chevron Corp – slide 43
    Fuels marketing activities Mexico retail market entry ExtraMile c-store joint venture Asia marketing position Plan to grow by up to 350 sites JV with Jacksons Food Stores Inc. Plan to grow by up to 300 sites Developing key branded…
  44. June 2018 Investor Presentation – Chevron Corp – slide 44
    Refinery performance1 Utilization Energy efficiency Net cash margin Percent Index Index 90% 120 35 2 1 1 2 5 1 4 2 4 2 2 2 2 2 1 70% 80 2008 2010 2012 2014 2016 2017 2008 2010 2012 2014 2016 2017 2008 2010 2012 2014…
  45. June 2018 Investor Presentation – Chevron Corp – slide 45
    Petrochemicals portfolio U.S. Gulf Coast Middle East Asia Pacific ChevronPhillips Chemical Advantaged feed, scale & technology 1 HDPE marketer Leading NAO producer MarTECH Loop Slurry GS Caltex Scale, location advantage 4th…
  46. June 2018 Investor Presentation – Chevron Corp – slide 46
    Advantaged feedstock Ethylene cash costs per metric ton 1,000 Petrochemicals profitability Oil / gas price ratio continues to benefit lighter feedstocks 500 North America ethane maintains advantage over Asia naphtha…
  47. June 2018 Investor Presentation – Chevron Corp – slide 47
    Lubricants and additives Premium base oil Leading producer, global slate Finished lubricants Formulation technology expertise Strong global brands Additives Leading global supplier Premium base oil plant Equity blend plants…
  48. June 2018 Investor Presentation – Chevron Corp – slide 48
    Midstream outlook 2018 Chevron Corporation
  49. June 2018 Investor Presentation – Chevron Corp – slide 49
    Gas and LNG pricing Regional gas pricing /MMBTU 12 Gas is an increasingly Market range for global commodity 10 oil-linked LNG contract prices 8 Steady demand growth and ample supply 6 capacity Asia LNG Spot 4 2 Henry…
  50. June 2018 Investor Presentation – Chevron Corp – slide 50
    Macro landscape - LNG Global LNG supply & demand MMTPA 600 500 Supply capacity (existing & under construction) Supply Market oversupply 400 opportunity in mid-term 300 200 Pacific basin Supply gap developing next decade 100…
  51. June 2018 Investor Presentation – Chevron Corp – slide 51
    LNG supply curve LNG development costs /MMBTU 15 9/MMBTU or less Abundant lower-cost 10 delivered to Asia LNG supply Debottleneck opportunities in Australia Focus on cost 5 competitive LNG opportunities 0 100 200 300…
  52. June 2018 Investor Presentation – Chevron Corp – slide 52
    energy IQ Environmental, Social and Governance 2018 Chevron. All rights reserved.
  53. June 2018 Investor Presentation – Chevron Corp – slide 53
    Creating value responsibly Enabling Continued engagement human progress Socially and with investors environmentally and stakeholders responsible Strong governance Robust strategy and enterprise risk management Source:…
  54. June 2018 Investor Presentation – Chevron Corp – slide 54
    Oil and gas demand scenarios Oil and natural gas will account for about half of global energy consumption under almost any future market scenario IEAs world total primary energy mix Coal Coal Gas Gas Gas Coal Nuclear Nuclear…
  55. June 2018 Investor Presentation – Chevron Corp – slide 55
    Climate change resilience Actions and investments Renewable energy Our operations Investing in technology Biofuels Energy efficiency Future Energy Solar Flaring reduction Fund Initial Wind Methane management 100M Geothermal…
  56. June 2018 Investor Presentation – Chevron Corp – slide 56
    Chevron Technology Ventures In 1999, Chevron was the first IOC to form a venture capital fund, Chevron Technology Ventures, which champions the innovation, commercialization and integration into Chevron emerging technologies.…
  57. June 2018 Investor Presentation – Chevron Corp – slide 57
    Methane management Upstream methane intensity* 0.18% Founding member of the Subsea Environmental Partnership EPC services Non-engineered equipment 0.12% One of the first IOC to report Professional services voluntarily on…
  58. June 2018 Investor Presentation – Chevron Corp – slide 58
    Highly engaged, diverse board with relevant experience and expertise Board of Directors Balanced Director Tenure Michael K. Wirth Ronald D. Sugar Chairman and Chief Executive Officer Lead Director 0-3 5 Chairman and Chief Executive…
  59. June 2018 Investor Presentation – Chevron Corp – slide 59
    Board and committee risk oversight One of the many duties of the Board is to oversee Chevrons risk management policies and practices to ensure that the appropriate risk management systems are employed throughout the Company Board of…
  60. June 2018 Investor Presentation – Chevron Corp – slide 60
    Executive compensation Our objective is to attract and retain leaders who will deliver long-term stockholder value in any business environment Pay element Metrics/Purpose Majority of compensation is at risk Base Salary Fixed level…
  61. June 2018 Investor Presentation – Chevron Corp – slide 61
    Appendix: reconciliation of non-GAAP measures Cash flow from operations excluding working capital MM 1Q16 2Q16 3Q16 4Q16 2016 1Q17 2Q17 3Q17 4Q17 2017 1Q18 avg. avg. *Net Cash Provided by Operating 1,141 2,531 5,311 3,863 3,212…
  62. June 2018 Investor Presentation – Chevron Corp – slide 62
    Appendix: reconciliation of non-GAAP measures Free cash flow excluding working capital MM 1Q16 2Q16 3Q16 4Q16 2016 1Q17 2Q17 3Q17 4Q17 2017 1Q18 avg. avg. *Net Cash Provided by Operating 1,141 2,531 5,311 3,863 3,212 3,777 5,036…
  63. June 2018 Investor Presentation – Chevron Corp – slide 63
    Appendix: reconciliation of non-GAAP measures Cash flow after capex excluding asset sales MM Full Year 2017 Net Cash Provided by Operating Activities 20,515 Net Cash Used for Investing Activities (note: includes Capital…
  64. June 2018 Investor Presentation – Chevron Corp – slide 64
    Appendix: reconciliation of Chevrons adjusted earnings TOTAL DOWNSTREAM 2017 2016 2015 2014 2013 Reported Earnings (MM) 5,214 3,435 7,601 4,336 2,237 Adjustment Items: Asset Dispositions (675) (490) (1,710) (960) -- Other…
  65. June 2018 Investor Presentation – Chevron Corp – slide 65
    Appendix: reconciliation of Chevrons adjusted earnings TOTAL DOWNSTREAM, EXCLUDING PETROCHEMICALS 2017 2016 2015 2014 2013 Earnings (MM) 4,671 2,823 6,586 3,176 1,234 Adjustment Items: Asset Dispositions (675) (490) (1,710)…

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