George Kirkland News

Chevron Corporation (NYSE: CVX) announced that crude oil and natural gas production has begun at the Jack/St. Malo project in the Lower Tertiary trend, deepwater U.S. Gulf of Mexico. Jack/St. Malo is a key part of Chevron's strong queue of upstream projects and was delivered on time and on budget. The Jack and St. Malo fields are among the largest in the Gulf of Mexico. They were discovered in 2004 and 2003, respectively, and production from the first development stage is expected to ramp up over the next several years to a total daily rate of 94…

Chevron Corporation announced today that the Hess Corporation-operated Tubular Bells deepwater project, located in the U.S. Gulf of Mexico, has started crude oil and natural gas production. The field is located 135 miles (217 km) southeast of New Orleans, in approximately 4,300 feet (1,310 m) of water in the Mississippi Canyon area. The discovery well was drilled in 2003, and project construction began in October 2011. Tubular Bells is expected to deliver total production of approximately 50,000 barrels of oil-equivalent per day producing from three wells. "The deepwater Gulf of Mexico plays a significant part in our earnings and production growth.

Chevron Corporation announced today that its subsidiary, Union Oil Company of California (Union), has reached a final investment decision to proceed with the development of the Hess Corporation-operated Stampede project in the deepwater U.S. Gulf of Mexico. Stampede is a deepwater subsea development, which will be tied-back to a newly constructed Tension Leg Platform. The project design capacity will be 80,000 barrels of crude oil per day. Project cost is expected to be approximately $6 billion. The drilling program includes a total of six production and four water injection wells. Drilling is planned to commence in the fourth quarter 2015 with first production expected in 2018.

Chevron Corporation has announced an oil discovery at the Coronado prospect in the deepwater U.S. Gulf of Mexico. The Walker Ridge Block 98 Well No. 1 encountered more than 400 feet (122 m) of net pay. The well is located approximately 190 miles (308 km) off the Louisiana coast in 6,127 feet (1,868 m) of water and was drilled to a depth of 31,866 feet (9,713 m). The well results are still being evaluated, and additional work is needed to determine the extent of the resource. Chevron, with a 40 percent working interest in the prospect, is the operator of the Coronado discovery well.

Chevron Corporation's China subsidiary signs production sharing contracts for exploration blocks in the Pearl River Estuary, South China Sea. Chevron's agreement is with China National Offshore Oil Corporation (CNOOC). Under the PSC agreements, Chevron China Energy Company will hold a 100 percent interest in blocks 15/10 and 15/28 in the Pearl River Mouth Basin. During the exploration phase Chevron China Energy Company will be the operator of the two shallow water blocks, which in total cover an area of approximately 2,233 square miles (5,782 square km). “Exploration of these blocks builds on our strategy to grow our business across the Asia Pacific region, where we are developing LNG, deepwater, shale and sour gas resources,” said George Kirkland, vice chairman, Chevron Corporation.

Natural gas deposits discovered in two locations by Chevron Australia's deepwater drilling exploration program in the Carnarvon Basin. The Pinhoe-1 exploration discovery well encountered approximately 197 feet (60 meters) of net gas pay in the Barrow and Mungaroo Sands. Pinhoe-1 is located in the WA-383-P permit area, located approximately 124 miles (200 kilometers) north of Exmouth off the Western Australia coast. The well was drilled in 3,048 feet (929 meters) of water to a total depth of 13,396 feet (4,083 meters). The Arnhem-1 exploration discovery well confirmed approximately 149 feet (45.5 meters) of net gas pay in the upper Mungaroo Sands. Arnhem-1 is in the WA-364-P permit area, located approximately 180 miles (290 kilometres) north of Exmouth off the Western Australia coast.

Chevron Corporation announce that its wholly owned subsidiary Chevron Global Energy Inc. (Chevron) will be assigned a 50 percent working interest in Blocks 42 and 45 offshore Suriname through an agreement with Kosmos Energy. Under the agreement, Kosmos will have a 50 percent working interest and remain operator of both blocks until the end of the exploration phase. Chevron will assume the remaining 50 percent working interest and will be the operator following any commercial discoveries. “This agreement enables us to explore for new resources in this frontier basin,” said George Kirkland, vice chairman, Chevron Corporation. Blocks 42 and 45 are located approximately 155 miles (250 kilometers) from Paramaribo and cover a combined area of approximately 2.8 million gross acres…

Chevron Corporation announced that the Pacific Santa Ana, a deepwater drillship built to Chevron's specifications, has arrived in the Gulf of Mexico to work for Chevron under a five-year contract with a subsidiary of Pacific Drilling S.A. It is the first drillship designed with the capacity to perform dual gradient drilling (DGD). Unlike conventional deepwater drilling, which uses a single drilling fluid weight in the borehole, dual gradient drilling employs two weights of drilling fluid – one above the seabed, another below. This allows drillers to more closely match the pressures presented by nature and effectively eliminates water depth as a consideration in well design.

Chevron Corp. announced further drilling success in the Carnarvon Basin offshore Western Australia, Australia's premier hydrocarbon basin. The Acme-1 exploration discovery well is located in the WA-205-P permit area offshore Western Australia approximately 93 miles (150 km) from Onslow. Drilled in 2,880 feet (878 m) of water to a depth of 15,469 feet (4,715 m), the well encountered approximately 896 feet (273 m) of net gas pay. George Kirkland, vice chairman, Chevron, said, "In terms of net gas pay, Acme-1 is one of our most significant natural gas discoveries in Australia. Jim Blackwell, president, Chevron Asia Pacific Exploration and Production, said, "We are realizing the opportunities we have as a leading lease holder in the Carnarvon Basin.

Chevron Corporation reported that it has completed a record setting production test on the Jack #2 well at Walker Ridge Block 758 in the U.S. Gulf of Mexico. The Jack well was completed and tested in 7,000 ft. of water, and more than 20,000 ft. under the sea floor, breaking Chevron's 2004 Tahiti well test record as the deepest successful well test in the Gulf of Mexico. The Jack #2 well was drilled to a total depth of 28,175 ft. The test was conducted during the second quarter of 2006 and was designed to evaluate a portion of the total pay interval. During the test, the well sustained a flow rate of more that 6,000 barrels of crude oil per day with the test representing approximately 40 percent of the total net pay measured in the Jack #2 well.

Chevron Corporation is proceeding with the development of the Blind Faith Field in the deepwater Gulf of Mexico. The field will be developed using a semisubmersible production facility, with first production expected during the first half of 2008. Chevron is the operator and holds a 62.5 percent working interest. Blind Faith is located in approximately 7,000 feet of water, about 160 miles southeast of New Orleans, on Mississippi Canyon blocks 695 and 696. The discovery well was drilled in June 2001 and encountered more than 200 feet of net pay in Miocene sands at depths of 20,900 feet to 24,300 feet. A successful appraisal well was drilled in 2004. The field has an estimated gross resource potential exceeding 100 million barrels of oil-equivalent.