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February 2019 Investor Presentation – Chevron Corp

Chevron Corp · Feb 24, 2019 · 69 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. February 2019 Investor Presentation – Chevron Corp – slide 1
    Chevron 2019 Investor Presentation February 2019 2019 Chevron Corporation
  2. February 2019 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 1 safety and spill 10 1 1 1 1 2014 2015 2016 2017 performance 2014 2015…
  3. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 4
    Financial highlights 4Q18 2018 Earnings 3.7 billion 14.8 billion Earnings per diluted share 1.95 7.74 Earnings / EPS (excluding special items and FX)1 3.7 billion / 1.95 15.5 billion / 8.07 Cash flow from operations / excl.…
  5. February 2019 Investor Presentation – Chevron Corp – slide 5
    Cash flow trend improving Cash flow from operations Dividend breakeven* billions /bbl 8 90 86 80 6 70 4 Delivering 2018 cash generation 60 58 53 2 50 40 2016 2017 2018 2016 2017 2018 avg avg avg Quarterly…
  6. February 2019 Investor Presentation – Chevron Corp – slide 6
    Delivering on all four financial priorities 2018 vs. 2017 billions Four financial priorities 2 1 Maintain and grow dividend CFFO Working Cash ex WC capital capex 2 Fund capital program -0.7 3 Strong balance sheet 4 Return surplus…
  7. February 2019 Investor Presentation – Chevron Corp – slide 7
    Looking ahead 1Q 2019 outlook Upstream Full year 2019 production 4-7% growth from 2018 (excluding asset sales) TCO co-lending Downstream Low refinery turnaround activity Corporate Full year cash flow headwinds guidance of…
  8. February 2019 Investor Presentation – Chevron Corp – slide 8
    Winning in any environment 2018 performance Grew production Grow production & Returns-driven sustain margins capital allocation Grew upstream cash margin Improved CFFO ROCE* Lower our cost structure Lowered unit costs…
  9. February 2019 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. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 11
    Sustainable portfolio Reserves to production ratio1 Resource to production ratio2,3 Years Years 18 40 16 Prudent and stable 14 reserves to production 30 20 12 Long-lived resource base 10 10 8 2012 2013 2014 2015…
  12. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 13
    Disciplined C&E program Total capital & exploratory expenditures billions Flat with 2018 20.1 20 2.0 Increases in shale & tight 4.3 Low execution risk 0.9 1.6 3.6 5.1 70% of spend delivers 2.5 cash within 2 years 2018*…
  14. February 2019 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. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 16
    2019 production outlook Net production MBOED 4 7% growth excluding the impact of 3,200 2019 asset sales Growth 3,100 Shale & tight 3,000 Wheatstone 2,900 2,800 Uncertainties 2,930 External events 2,700 NOJV activity levels 2,600…
  17. February 2019 Investor Presentation – Chevron Corp – slide 17
    Production growth at low C&E Projected net production at 60/bbl MMBOED Base1 plus shale & tight 4-7% 23% CAGR through 2022 growth in 2019 with 910B capital spend/yr2 7% growth 5% growth 2.93 2.73 Uncertainties 2.59…
  18. February 2019 Investor Presentation – Chevron Corp – slide 18
    Portfolio optimization Asset sale proceeds billions (before tax) Target 10 510 Divestment criteria Strategic alignment Public domain Azerbaijan Resource potential U.K. Central Relative economics Axis Title North Sea 5…
  19. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 20
    Initiate share repurchase 2018 Historical total shareholder distributions billions Maintain and grow dividend 4% increase in 1Q18 9 Fund capital program Disciplined and on track 6 Strong balance sheet Average…
  21. February 2019 Investor Presentation – Chevron Corp – slide 21
    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…
  22. February 2019 Investor Presentation – Chevron Corp – slide 22
    Upstream 2019 Chevron Corporation
  23. February 2019 Investor Presentation – Chevron Corp – slide 23
    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…
  24. February 2019 Investor Presentation – Chevron Corp – slide 24
    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…
  25. February 2019 Investor Presentation – Chevron Corp – slide 25
    2018 reserves Replacing reserves while growing production 1 year reserve replacement Billion BOE Reserve Significant reserve replacement 13 additions in 2018: ratio Permian 136% 12 Marcellus / Utica 1 year 11 12.1…
  26. February 2019 Investor Presentation – Chevron Corp – slide 26
    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…
  27. February 2019 Investor Presentation – Chevron Corp – slide 27
    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…
  28. February 2019 Investor Presentation – Chevron Corp – slide 28
    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…
  29. February 2019 Investor Presentation – Chevron Corp – slide 29
    Permian unconventional production Midland and Delaware Basin* 4Q production 377 MBOED Net MBOED up 84% from 4Q17 800 700 600 Annual production 310 MBOED 500 up 71% from 2017 400 300 Oil and liquids takeaway capacity 200…
  30. February 2019 Investor Presentation – Chevron Corp – slide 30
    Industry leading Permian position Coring up acreage 80% acreage no or low royalty Enhancing value with transactions Transacted 150,000 acres in 2017 and 2018 Increased average lateral length per well by 35% since 2016…
  31. February 2019 Investor Presentation – Chevron Corp – slide 31
    Permian takeaway capacity Midstream business Cumulative firm transport capacity of 100% of operated + non-operated take-in-kind crude production through 2019 Firm dock capacity in the Houston Ship Channel with additional…
  32. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 33
    Gorgon / Wheatstone Strong performance Net production MBOED 400 4Q18 net production Gorgon 223 MBOED 300 Wheatstone 171 MBOED 200 Wheatstone domestic gas 100 Fully commissioned First sales expected imminently Production…
  34. February 2019 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. February 2019 Investor Presentation – Chevron Corp – slide 35
    FGP / WPMP Progressing toward first production in 2022 Overall project 40% complete Pipe-racks and modules in transit from Kazakhstan, Korea, and Italy 6 pipe-rack modules delivered to site 3 drilling rigs in operation…
  36. February 2019 Investor Presentation – Chevron Corp – slide 36
    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…
  37. February 2019 Investor Presentation – Chevron Corp – slide 37
    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…
  38. February 2019 Investor Presentation – Chevron Corp – slide 38
    Downstream & Chemicals 2019 Chevron Corporation
  39. February 2019 Investor Presentation – Chevron Corp – slide 39
    Profitable downstream & chemicals portfolio Fuels refining & marketing Petrochemicals Lubricants & additives Focused, regional optimization Advantaged feed, scale and technology Strategic positions serving global markets Refinery…
  40. February 2019 Investor Presentation – Chevron Corp – slide 40
    Strategy focused on leading returns World-class operational excellence Grow earnings across the value chain Target investments Lead the industry in returns 2019 Chevron Corporation 41
  41. February 2019 Investor Presentation – Chevron Corp – slide 41
    Downstream financial performance Strong track record Reported earnings Adjusted earnings per barrel1,2 billions /bbl 10 6 1 5 2.66 3 1 1 1 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 15.3% 24.8% 13.0% 14.1%…
  42. February 2019 Investor Presentation – Chevron Corp – slide 42
    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…
  43. February 2019 Investor Presentation – Chevron Corp – slide 43
    Refinery planned turnarounds A/T earnings impact of planned turnarounds* millions 2013 2017 average 300 Third quarter typically lowest activity High 200 Average Forward earnings Medium guidance categories 100 High 200MM…
  44. February 2019 Investor Presentation – Chevron Corp – slide 44
    Pasadena refinery acquisition Scope 110 MBD Houston Ship Channel terminal 5.6 million barrels storage 143 acres vacant land Explorer Pipeline Strategic fit Permian Eagle Ford Colonial Pipeline Pascagoula Enhances light…
  45. February 2019 Investor Presentation – Chevron Corp – slide 45
    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…
  46. February 2019 Investor Presentation – Chevron Corp – slide 46
    Retail, lubricants, and additives Progress and innovation Mobile pay PayPal and Honda partnerships in U.S. CaltexGO mobile pay in Southeast Asia Retail growth Lubricants & additives On track for 400 branded sites in Ground…
  47. February 2019 Investor Presentation – Chevron Corp – slide 47
    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 ChevronPhillips…
  48. February 2019 Investor Presentation – Chevron Corp – slide 48
    Petrochemicals value chains U.S. Gulf Coast Middle East Asia Advantaged feedstock Strategic partnerships enable access to GS Caltex USGC Petchem above nameplate advantaged feedstock 4th largest aromatics single site capacity…
  49. February 2019 Investor Presentation – Chevron Corp – slide 49
    Petrochemicals major capital projects Growing portfolio Operating Pre FEED FEED ChevronPhillips Chemical ChevronPhillips Chemical GS Caltex Co. Co. USGC Petrochemicals project I USGC Petrochemicals project II Mixed feed cracker…
  50. February 2019 Investor Presentation – Chevron Corp – slide 50
    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…
  51. February 2019 Investor Presentation – Chevron Corp – slide 51
    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…
  52. February 2019 Investor Presentation – Chevron Corp – slide 52
    Downstream well positioned for IMO 2020 Conversion capacity and complexity 100% 15 Complex refiners Conversion to crude capacity ratio CVX advantaged Nelson complexity index XOM Highest Nelson complexity 40%…
  53. February 2019 Investor Presentation – Chevron Corp – slide 53
    Midstream outlook 2019 Chevron Corporation
  54. February 2019 Investor Presentation – Chevron Corp – slide 54
    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…
  55. February 2019 Investor Presentation – Chevron Corp – slide 55
    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…
  56. February 2019 Investor Presentation – Chevron Corp – slide 56
    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…
  57. February 2019 Investor Presentation – Chevron Corp – slide 57
    energy IQ ESG investor presentation 2019 Chevron Corporation
  58. February 2019 Investor Presentation – Chevron Corp – slide 58
    Leading in the energy future Enabling human progress Creating value responsibly Developing more Deploying the best energy with less talent to solve the most environmental impact complex problems Leveraging global Finding…
  59. February 2019 Investor Presentation – Chevron Corp – slide 59
    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 6 Chairman and Chief Executive…
  60. February 2019 Investor Presentation – Chevron Corp – slide 60
    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…
  61. February 2019 Investor Presentation – Chevron Corp – slide 61
    Energy demand views IEAs world total primary energy mix Oil and natural gas are expected to account for about half of global energy consumption under almost any future market scenario Coal Coal Gas Gas Gas Coal Nuclear…
  62. February 2019 Investor Presentation – Chevron Corp – slide 62
    Climate change resilience Portfolio testing Most of our assets are competitive when tested against aggressive scenarios like IEAs SDS. Our portfolio is resilient and flexible. Supply/demand scenarios 2019 Chevron Corporation…
  63. February 2019 Investor Presentation – Chevron Corp – slide 63
    Actions External engagements OGCI Climate Change Flaring and Methane Proactive engagement (Oil and Gas Climate Initiative) Resilience report Reduction Metric with governments we advocate market-based mechanisms Under development:…
  64. February 2019 Investor Presentation – Chevron Corp – slide 64
    Actions Technology and future energy DS&C biofuels Adjacencies GHG R&D CTV Future Energy Fund increased emphasis on renewable diesel biojet; power our operations from seed funds for the trial and use of emission- biofuel…
  65. February 2019 Investor Presentation – Chevron Corp – slide 65
    Executive compensation Our objective is to attract and retain leaders who will deliver long-term stockholder value in any business environment In 2017 and 2018, Chevrons Say-on-Pay vote received over 93% percent. A contributing…
  66. February 2019 Investor Presentation – Chevron Corp – slide 66
    Appendix: reconciliation of non-GAAP measures Reported earnings to earnings excluding special items and FX FY 2017 1Q18 2Q18 3Q18 4Q18 FY 2018 Reported earnings (MM) Upstream 8,150 3,352 3,295 3,379 3,290 13,316 Downstream 5,214…
  67. February 2019 Investor Presentation – Chevron Corp – slide 67
    Appendix: reconciliation of non-GAAP measures Cash flow from operations excluding working capital MM 2016 FY 2016 2017 FY 2017 1Q18 2Q18 3Q18 4Q18 2018 FY 2018 quarterly quarterly quarterly avg. avg. avg. *Net Cash Provided by…
  68. February 2019 Investor Presentation – Chevron Corp – slide 68
    Appendix: reconciliation of Chevrons adjusted earnings TOTAL DOWNSTREAM 2014 2015 2016 2017 2018 Reported Earnings (MM) 4,336 7,601 3,435 5,214 3,798 Adjustment Items: Asset Dispositions (960) (1,710) (490) (675) (350)…
  69. February 2019 Investor Presentation – Chevron Corp – slide 69
    Appendix: reconciliation of Chevrons adjusted earnings TOTAL DOWNSTREAM, EXCLUDING PETROCHEMICALS 2014 2015 2016 2017 2018 Earnings (MM) 3,176 6,586 2,823 4,671 2,932 Adjustment Items: Asset Dispositions (960) (1,710)…

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