Caspian Pipeline Consortium Marks the Groundbreaking for its $5.4 Billion Expansion

Moscow, Russia – Chevron Neftegaz, Inc. an affiliate of Chevron Corporation (NYSE:CVX) announced today at a groundbreaking ceremony in Atyrau, Kazakhstan, that the Caspian Pipeline Consortium (CPC) has marked the start of the construction phase of the $5.4 billion expansion of the Caspian pipeline. The capacity of the 900-mile (1,500-km) pipeline, which carries crude oil from western Kazakhstan to a dedicated terminal in the Black Sea, will increase to 1.4 million barrels per day from its current capacity of 730,000 barrels per day. The project will be implemented in three phases with capacity increasing progressively from 2012 to 2015.

Chevron, one of the largest CPC shareholders, is providing project management services to the project. Andrew McGrahan, President of Neftegaz, Inc., said, “CPC is a key strategic asset for Chevron and adds to our strong position in the region. Chevron greatly appreciates the efforts of all shareholders, especially the representatives of Transneft and KazMunaiGaz, in reaching this important landmark.” McGrahan added, “CPC is a model of cooperation between Russia and Kazakhstan and is an indication of the confidence we have in Russia and in oil transportation from the Caspian region. This groundbreaking event represents years of dedication and commitment to expanding the commercial links between the two countries and sends a powerful signal that Russia and Kazakhstan are countries where major, long-term capital investments can be made with confidence.”

The project will consist of the refurbishment of the existing five pump stations, the addition of 10 new pumping stations, the replacement of a 55-mile (88-km) section of the line, six new storage tanks and the addition of a third offshore mooring point at the Black Sea terminal, six miles (10 km) north of the Port of Novorossiysk. CPC awarded all the major construction contracts in May 2011.

The first CPC groundbreaking ceremony took place 12 years ago. In October this year, CPC will celebrate 10 years of successful tanker loading. Since the start of operations, over 2 billion barrels of oil (250 million tons) have been transported through the system.

Chevron is one of the world’s leading integrated energy companies, with subsidiaries that conduct business worldwide. The company is involved in virtually every facet of the energy industry. Chevron explores for, produces and transports crude oil and natural gas; refines, markets and distributes transportation fuels and lubricants; 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. Chevron is based in San Ramon, Calif. More information about Chevron is available at www.chevron.com.

Note to editors: Equity interest in the Caspian Pipeline Consortium is allocated as follows:
• Russian Federation (24 percent) ₁
• Republic of Kazakhstan (19 percent) ₂
• Chevron Caspian Pipeline Consortium Company (15 percent)
• LUKARCO B.V. (12.5 percent)
• Rosneft-Shell Caspian Ventures Limited (7.5 percent)
• Mobil Caspian Pipeline Company (7.5 percent)
• Caspian Pipeline Company (7 percent) ₁
• ENI International (N.A.) N.V. S.ar.l. (2 percent)
• BG Overseas Holdings Limited (2 percent)
• Kazakhstan Pipeline Ventures L.L.C. (1.75 percent) ²
• Oryx Caspian Pipeline L.L.C. (1.75 percent).

₁ Transneft represents the shares of the Russian Federation and the Caspian Pipeline Company
² Kazmunaigas represents the shares of the Republic of Kazakhstan and Kazakhstan Pipeline Ventures