Chevron Announces $21.6 Billion Capital and Exploratory Budget for 2010

* Upstream spending estimated at $17.3 billion, funding an industry-leading slate of crude oil and natural gas projects
* Downstream budget of $3.4 billion includes outlays for a continued focus on refinery reliability and flexibility

SAN RAMON, Calif. - Chevron Corporation (NYSE: CVX) today announced a $21.6 billion capital and exploratory spending program for 2010, a five percent decrease from projected 2009 expenditures. Included in the 2010 program are $1.6 billion of expenditures by affiliates, which do not require cash outlays by Chevron’s consolidated companies.

“Our company is in a strong financial position,” said Chairman and CEO Dave O’Reilly.

O’Reilly said about 80 percent of the 2010 spending program is for upstream oil and gas exploration and production projects worldwide. Another 16 percent is associated with the company’s downstream businesses that manufacture, transport and sell gasoline, diesel fuel and other refined products.

“Much of our 2010 spending continues to be on large, multiyear projects consistent with our upstream growth strategies and on improving operating efficiency and reliability,” O’Reilly added.
Highlights of the 2010 Capital and Exploratory Spending Program Chevron 2010 Planned Capital & Exploratory Expenditures $ Billions
U.S. Upstream $ 4.1
International Upstream 13.2
Total Upstream 17.3
U.S. Downstream 1.6
International Downstream 1.8
Total Downstream 3.4
Chemicals and Other 0.9
TOTAL (Including Chevron’s Share of Expenditures by Affiliated Companies) $21.6
Expenditures by Affiliated Companies (1.6)
Cash Expenditures by Chevron Consolidated Companies $20.0
Upstream - Exploration and Production

Spending of $17.3 billion is planned for exploration, production and natural gas-related projects. Major capital projects include development of the Gorgon natural gas project in Western Australia and opportunities in the deepwater U.S. Gulf of Mexico, offshore western Africa and the Gulf of Thailand. Funding is also planned for focused appraisal in core hydrocarbon basins.

“Our upstream investments are aimed at finding and developing oil and gas resources to help supply the energy needs of economies around the world,” said George Kirkland, Chevron’s executive vice president of Upstream and Gas.

Major upstream spending expected in 2010 includes activities in the following areas:

* Western Australia – development of Gorgon and Wheatstone natural gas resources, including LNG facilities.
* U.S. Gulf of Mexico – deepwater exploration and development, including Jack-St. Malo, Perdido, Tahiti, Tonga and Big Foot.
* Brazil – development of the Frade and Papa Terra fields.
* Nigeria – development of the Usan and Agbami deepwater fields.
* Angola – construction of LNG facilities and development of Block 14 deepwater assets.
* Thailand – development of the offshore Platong Gas II project.
* China – development of the Chuandongbei natural gas project.
* Canada – Athabasca Oil Sands expansion.

Downstream – Refining, Marketing and Transportation

Capital spending of $3.4 billion in 2010 is budgeted for global downstream operations. Included in the budget is $1.6 billion for projects in the United States, primarily for refinery projects.

These expenditures will enhance the company’s ability to safely and reliably manufacture transportation fuels from a variety of feedstocks, improve product yields, increase energy efficiency and provide environmental benefits.

Outlays in 2010 include projects in the company’s refineries in Mississippi and California. The company’s 50 percent-owned GS Caltex affiliate is also expected to continue development work on upgrading of its Yeosu refining complex in South Korea. In support of projects to commercialize the company’s large natural gas resource base, downstream expenditures will be made in 2010 on gas-to-liquids manufacturing facilities.
Chemicals and Other

Expenditures of approximately $0.9 billion in 2010 are budgeted for chemicals, technology, power generation and other corporate activities.

Chevron Corporation is one of the world’s leading integrated energy companies, with subsidiaries that conduct business worldwide. The company’s success is driven by the ingenuity and commitment of approximately 62,000 employees who operate across the energy spectrum. Chevron explores for, produces and transports crude oil and natural gas; refines, markets and distributes transportation fuels and other energy products; manufactures and sells petrochemical products; generates power and produces geothermal energy; provides energy efficiency solutions; and develops the energy resources of the future, including biofuels and other renewables. Chevron is based in San Ramon, Calif. More information about Chevron is available at www.chevron.com.

CAUTIONARY STATEMENT RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This press release of Chevron Corporation contains forward-looking statements relating to Chevron’s operations that are based on management’s current expectations, estimates and projections about the petroleum, chemicals, and other energy-related industries. Words such as “anticipates,” “expects,” “intends,” “plans,” “targets,” “projects,” “believes,” “seeks,” “schedules,” “estimates,” “budgets” and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond the company’s control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Unless legally required, Chevron undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are crude-oil and natural-gas prices; refining, marketing and chemicals margins; actions of competitors or regulators; timing of exploration expenses; timing of crude-oil liftings, the competitiveness of alternate-energy sources or product substitutes; technological developments; the results of operations and financial condition of equity affiliates; the inability or failure of the company’s joint-venture partners to fund their share of operations and development activities; the potential failure to achieve expected net production from existing and future crude-oil and natural-gas development projects; potential delays in the development, construction or start-up of planned projects; the potential disruption or interruption of the company’s net production or manufacturing facilities or delivery/transportation networks due to war, accidents, political events, civil unrest, severe weather or crude-oil production quotas that might be imposed by the Organization of Petroleum Exporting Countries (OPEC); the potential liability for remedial actions or assessments under existing or future environmental regulations and litigation; significant investment or product changes under existing or future environmental statutes, regulations and litigation; the potential liability resulting from pending or future litigation; the company’s acquisition or disposition of assets; gains and losses from asset dispositions or impairments; government-mandated sales, divestitures, recapitalizations, industry-specific taxes, changes in fiscal terms or restrictions on scope of company operations; foreign-currency movements compared with the U.S. dollar; the effects of changed accounting rules under generally accepted accounting principles promulgated by rule-setting bodies; and the factors set forth under the heading “Risk Factors” on pages 30 and 31 of the company’s 2008 Annual Report on Form 10-K. In addition, such statements could be affected by general domestic and international economic and political conditions. Unpredictable or unknown factors not discussed in this press release could also have material adverse effects on forward-looking statements.