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2000
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2000
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OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 1-368-2
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Chevron Corporation
(Exact name of registrant as specified in its charter)
Delaware 94-0890210
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
575 Market Street, San Francisco, California 94105
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (415) 894-7700
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NONE
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(Former name or former address, if changed since last report.)
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
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Common stock par value $.75 per share New York Stock Exchange, Inc.
Preferred stock purchase rights Chicago Stock Exchange
Pacific Exchange
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. |X|
Aggregate market value of the voting stock held by nonaffiliates of the
Registrant
As of February 28, 2001 - $54,753,640,718
Number of Shares of Common Stock outstanding as of
February 28, 2001 - 641,094,523
DOCUMENTS INCORPORATED BY REFERENCE
(To The Extent Indicated Herein)
Notice of Annual Meeting and Proxy Statement Dated March 21, 2001 (in Part III)
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TABLE OF CONTENTS
Item Page No.
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PART I
1. Business...................................................... 1
(a) General Development of Business....................... 1
(b) Description of Business and Properties................ 3
Capital and Exploratory Expenditures................ 4
Petroleum - Exploration and Production................ 5
Liquids and Natural Gas Production.............. 5
Acreage........................................... 6
Reserves and Contract Obligations................. 7
Development Activities.......................... 8
Exploration Activities.......................... 9
Review of Ongoing Exploration and
Production Activities In Key Areas............. 9
Petroleum - Natural Gas Liquids....................... 14
Petroleum - Refining.................................. 14
Petroleum - Refined Products Marketing................ 15
Petroleum - Transportation............................ 17
Chemicals............................................. 18
Coal.................................................. 18
Electronic Commerce and Technology.................... 19
Research and Environmental Protection................. 19
2. Properties.................................................... 20
3. Legal Proceedings............................................. 20
4. Submission of Matters to a Vote of Security Holders........... 20
Executive Officers of the Registrant.......................... 21
PART II
5. Market for the Registrant's Common Equity
and Related Stockholder Matters............................... 22
6. Selected Financial Data....................................... 22
7. Management's Discussion and Analysis of Financial
Condition and Results of Operations........................... 22
8. Financial Statements.......................................... 22
8. Supplementary Data - Quarterly Results...................... 22
- Oil and Gas Producing Activities....... 22
9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure........................ 22
PART III
10. Directors and Executive Officers of the Registrant............ 23
11. Executive Compensation........................................ 23
12. Security Ownership of Certain Beneficial Owners
and Management............................................... 23
13. Certain Relationships and Related Transactions................ 23
PART IV
14. Exhibits, Financial Statement Schedules, and
Reports on Form 8-K.......................................... 23
Schedule II - Valuation and Qualifying Accounts............... 25
PART I
Item 1. Business
(a) General Development of Business
Summary Description of Chevron
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Chevron Corporation(1), a Delaware corporation, manages its investments in, and
provides administrative, financial and management support to, U.S. and foreign
subsidiaries and affiliates that engage in fully integrated petroleum
operations, chemicals operations, coal mining and energy services. The company
operates in the United States and approximately 100 other countries. Petroleum
operations consist of exploring for, developing and producing crude oil and
natural gas; refining crude oil into finished petroleum products; marketing
crude oil, natural gas and the many products derived from petroleum; and
transporting crude oil, natural gas and petroleum products by pipelines, marine
vessels, motor equipment and rail car. Chemicals operations include the
manufacture and marketing of commodity petrochemicals, plastics for industrial
uses and fuel and lubricating oil additives.
In this report, exploration and production of crude oil, natural gas liquids and
natural gas may be referred to as "E&P" or "upstream" activities. Refining,
marketing and transportation may be referred to as "RM&T" or "downstream"
activities. A list of the company's major subsidiaries is presented on page E-2
of this Annual Report on Form 10-K. As of December 31, 2000, Chevron had 34,610
employees, 73 percent of whom were employed in U.S. operations. Approximately
5,500, or 22 percent, of the company's U.S. employees are unionized.
- --------------------------------------------------------------------------------
CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE
PURPOSE OF "SAFE HARBOR" PROVISIONS OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This annual report on Form 10-K contains forward-looking statements
relating to Chevron's operations that are based on management's current
expectations, estimates and projections about the petroleum and chemicals
industries. Words such as "anticipates," "expects," "intends," "plans,"
"projects," "believes," "seeks," "estimates" 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 our control, are difficult to
predict and could cause actual results to differ from those expressed or
forecasted in the forward-looking statements. Therefore, actual outcomes and
results may differ materially from what is expressed or forecasted in such
forward-looking statements. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this report.
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 factors that could cause actual results to differ materially are
crude oil and natural gas prices; refining margins and marketing margins;
chemicals prices and competitive conditions affecting supply and demand for
aromatics, olefins and additives products; actions of competitors; the
competitiveness of alternate energy sources or product substitutes;
technological developments; inability of the company's joint-venture partners to
fund their share of operations and development activities; potential failure to
achieve expected production from existing and future oil and gas development
projects; potential delays in the development, construction or start-up of
planned projects; the ability to successfully consummate the proposed merger
with Texaco and successfully integrate the operations of both companies;
potential disruption or interruption of the company's production or
manufacturing facilities due to accidents or political events; potential
liability for remedial actions under existing or future environmental
regulations and litigation; significant investment or product changes under
existing or future environmental regulations (including, particularly,
regulations and litigation dealing with gasoline composition and
characteristics); and potential liability resulting from pending or future
litigation. In addition, such statements could be affected by general domestic
and international economic and political conditions. Unpredictable or unknown
factors not discussed herein also could have material adverse effects on
forward-looking statements.
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(1)Incorporated in Delaware in 1926 as Standard Oil Company of California, the
company adopted the name Chevron Corporation in 1984. As used in this report,
the term "Chevron" and such terms as "the company," "the corporation," "our,"
"we," and "us" may refer to Chevron Corporation, one or more of its consolidated
subsidiaries, or to all of them taken as a whole, but unless it is stated
otherwise, does not include "affiliates" of Chevron - i.e., those companies
accounted for by the equity method (generally owned 50 percent or less), or
investments accounted for by the cost method.
As used in this report, the term "Caltex" may refer to the Caltex Group of
companies, any one company of the group, any of their consolidated subsidiaries,
or to all of them taken as a whole, and also includes the "affiliates" of
Caltex.
All of these terms are used for convenience only, and are not intended as a
precise description of any of the separate companies, each of which manages its
own affairs.
-1-
Overview of Petroleum Industry
- ------------------------------
Petroleum industry operations and profitability are influenced by many factors,
over some of which individual oil and gas companies have little control.
Governmental policies, particularly in the areas of taxation, energy and the
environment, have a significant impact on petroleum activities, regulating where
and how companies conduct their operations and formulate their products and, in
some cases, limiting their profits directly. Prices for crude oil and natural
gas, petroleum products and petrochemicals are determined by supply and demand
for these commodities. OPEC member countries are typically the world's swing
producers of crude oil, and their production levels are a major factor in
determining worldwide supply. Demand for crude oil and its products and natural
gas is largely driven by the condition of local, national and worldwide
economies, although weather patterns and taxation relative to other energy
sources also play a significant part. Natural gas is generally produced and
consumed on a country or regional basis.
Operating Environment
- ---------------------
Refer to page FS-2 of this Annual Report on Form 10-K in Management's Discussion
and Analysis of Financial Condition and Results of Operations for a discussion
on the company's current operating environment and outlook.
Chevron Strategic Priorities
- ----------------------------
Chevron's strategic objective is to exceed the financial performance of its
strongest industry competitors in terms of total stockholder return. The
company's overriding goal is to achieve the highest total stockholder return in
its peer group for the five-year period 2000 - 2004. To achieve its goal, the
company has targeted a 15 percent annual growth rate in earnings per share for
the three-year period 2000 - 2002, supported by worldwide liquids and natural
gas production growth of 4 to 4.5 percent per year, and a minimum 12 percent
return on capital employed.
To attain these financial and operational targets, the company has established
four key priorities:
o Operational Excellence: Safe, reliable, efficient and environmentally
sound operations throughout are the top priority for the company. The
company seeks to ensure it achieves sustainable improvements in its
operations.
o Cost Reduction: The company will continue to focus on ways of reducing
costs across its activities. As examples, the company has seen ongoing
successes in cost reduction in the areas of energy consumption and global
procurement of goods and services.
o Capital Stewardship: The company is implementing work processes designed to
ensure that it employs capital funding most efficiently. This involves
decision-making tools aimed at selecting the most financially and
strategically attractive projects. Additionally, the company has developed
processes to ensure the execution of projects is efficient, bringing
projects to completion on time and within budgeted expenditures.
o Profitable Growth: The company will seek continued growth in its core
businesses - exploration and production, refining, marketing and
transportation, and chemicals. The company is also looking to capture new
opportunities, such as investing in power and gas through its Dynegy
affiliate, new process technologies - including a method for converting
natural gas to liquids - and information and Internet technologies.
Supporting these four priorities is a continued and improved focus on:
o Organizational Capability: The company has developed strategies to build
capability systems to achieve top performance in the four priorities
described above.
Chevron-Texaco Merger Agreement
- -------------------------------
In October 2000, Chevron and Texaco announced an agreement to combine the two
companies into an integrated global energy company. Upon approval by regulatory
authorities and stockholders of both companies, and fulfillment of other
conditions, Chevron will issue 0.77 of its common shares for each share of
Texaco stock. The new company - ChevronTexaco Corporation - will have
significantly enhanced positions in upstream and downstream operations, a global
chemicals business, a growth platform in power generation, and industry-leading
skills in technology innovation. Synergistic savings of at least $1.2 billion
are expected within six to nine months of the merger.
-2-
In advance of the merger approval by various regulatory authorities, Chevron and
Texaco work teams have been actively planning the integration of the two
companies, subject to customary legal restrictions on exchange of data between
competitors. In February 2001, the top 50 executives of the combined company
were announced. At the same time, a proposed organization structure was
outlined. The principal executive officers who will constitute a new Office of
the Chairman will be Chairman and CEO David O'Reilly (currently Chairman and CEO
of Chevron) and Vice Chairmen Richard Matzke (currently Vice Chairman of
Chevron) and Glenn Tilton (currently Chairman and CEO of Texaco). Three
corporate executive vice presidents will report to the office of the chairman
and have individual responsibility for downstream (refining marketing and
transportation); power, chemicals and technology; and administrative and
corporate services. Upstream (exploration and production) businesses will report
to Mr. Matzke.
On March 1, 2001, the European Union announced that it had approved the proposed
merger. Approvals are pending from the U. S. Federal Trade Commission (FTC) and
other agencies. Until consummation of the merger, Chevron and Texaco remain
competitors and continue to conduct day-to-day business under the laws dealing
with competitive practices for any independent company.
(b) Description of Business and Properties
The company's largest business segments are exploration and production
(upstream) and refining, marketing and transportation (downstream). Chemicals is
also a significant operation, conducted mainly by the company's affiliate -
Chevron Phillips Chemical Company LLC. The petroleum activities of the company
are widely dispersed geographically, with upstream and downstream operations in
the United States and Canada and upstream operations in Nigeria, Angola, Chad,
Equatorial Guinea, Republic of Congo, Democratic Republic of Congo, Australia,
the United Kingdom, Norway, China, Papua New Guinea, Thailand, Argentina, Brazil
and Venezuela. The company's Caltex affiliate, through its subsidiaries and
affiliates, conducts exploration and production and geothermal operations in
Indonesia and refining and marketing activities in Asia, Africa, the Middle
East, Australia and New Zealand, with major operations in Korea, Australia,
Thailand, the Philippines, Singapore and South Africa. The company's
Tengizchevroil affiliate conducts production activities in Kazakhstan. The
company expects to expand its operations in the Caspian Region by exploring for
crude oil and natural gas, expanding the production and transportation
infrastructure, developing new crude oil and natural gas markets, and
identifying other business opportunities.
The company's Dynegy Inc. (Dynegy) affiliate is one of the leading marketers of
energy products and services in the United States with customers in the United
States, Canada, the United Kingdom and other European countries. Its business
activities include energy marketing; independent power generation; gathering,
processing, selling and transportation of natural gas and natural gas liquids;
and broadband trading. In February 2000, Dynegy merged with Illinova
Corporation, an energy services holding company based in Illinois. The company
expects that this merger will accelerate Dynegy's growth in the power generation
and marketing business.
The company's Chevron Phillips Chemical Company LLC (CPCC) affiliate has
operations in the United States, Belgium, China, South Korea, Singapore, Saudi
Arabia and Mexico. CPCC commenced operations in July 2000 when Chevron combined
most of its petrochemicals businesses with those of Phillips Petroleum Company
into a 50-50 joint venture. The company's wholly owned Oronite additives
business has operations in the United States, France, Netherlands, Singapore,
Japan and Brazil.
Tabulations of segment sales and other operating revenues, earnings, income
taxes and assets, by United States and International geographic areas, for the
years 1998 to 2000, may be found in Note 10 to the consolidated financial
statements beginning on page FS-21 of this Annual Report on Form 10-K. In
addition, similar comparative data for the company's investments in and income
from equity affiliates and property, plant and equipment are contained in Notes
13 and 14 on pages FS-24 to FS-25.
The company's worldwide operations can be affected significantly by changing
economic, tax, regulatory and political environments in the various countries,
including the United States, in which it operates. Environmental regulations and
government policies concerning economic development, energy and taxation may
have a significant effect on the company's operations. Management evaluates the
economic and political risk of initiating, maintaining or expanding operations
in any geographical area. The company closely monitors political events
worldwide and the
-3-
possible threat these may pose to its activities - particularly the company's
oil and gas exploration and production operations - and the safety of the
company's employees.
The company attempts to avoid unnecessary involvement in partisan politics in
the communities in which it operates but participates in the political process
to safeguard its assets and to ensure that the community benefits from its
operations and remains receptive to its continued presence.
A discussion of the company's use of derivative financial instruments to manage
its exposure to price risk stemming from its integrated petroleum activities is
contained on page FS-6 of this Annual Report on Form 10-K.
Capital and Exploratory Expenditures
Worldwide capital and exploratory (C&E) expenditures totaled $5.153 billion in
2000, compared with $6.133 billion in 1999. Expenditures for consolidated
worldwide exploration and production decreased by 35 percent between years. This
decrease was driven by the absence in 2000 of two significant international
exploration and production acquisitions in 1999, which totaled approximately
$1.7 billion: the Rutherford-Moran Oil Corporation in Thailand and Petrolera
Argentina San Jorge S.A. in Argentina. Consolidated international refining,
marketing and transportation expenditures increased by 114 percent in 2000
driven by additional investments in the Caspian Pipeline Consortium, which
continued construction of pipeline facilities linking the Tengiz Field in
Kazakhstan with the Russian Black Sea port of Novorossiysk. Consolidated
chemicals expenditures were 70 percent lower in 2000 following the formation of
CPCC, which is accounted for under the equity method. All Other expenditures
increased by over 300 percent between years as the company made an additional
investment of about $300 million in Dynegy Inc.
The company's share of affiliates' capital expenditures increased by 24 percent
between years to $967 million, driven by higher expenditures by the company's
Tengizchevroil and Dynegy Inc. affiliates.
Chevron's C&E expenditures during 2000 and 1999 are summarized in the following
table:
Capital and Exploratory Expenditures
(Millions of Dollars)
2000 1999 Change %
- --------------------------------------------------------------------------------
Exploration and Production - United States $1,237 $ 900 $ 337 37
International 1,475 3,242 (1,767) (55)
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Sub-total 2,712 4,142 (1,430) (35)
Refining, Marketing
and Transportation - United States 481 516 (35) (7)
International 391 183 208 114
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Sub-total 872 699 173 25
Chemicals - United States 78 326 (248) (76)
International 41 67 (26) (39)
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Sub-total 119 393 (274) (70)
All Other 483 117 366 313
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Total Consolidated Companies 4,186 5,351 (1,165) (22)
Chevron's Share in Affiliates 967 782 185 24
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Total Including Affiliates $5,153 $6,133 $ (980) (16)
======== ====== =======
The company's 2001 C&E expenditures, including its share of equity affiliates'
expenditures, are projected at $6 billion, 16 percent higher than 2000 spending
levels. The company plans to invest $3.7 billion, or 62 percent of its total
spending, in worldwide exploration and production, of which $1.2 billion will be
expended in the United States. About $1.4 billion will be invested in worldwide
refining, marketing and transportation activities. Investments in chemicals will
be about $250 million with about $650 million targeted for all other activities,
including power and natural gas facilities and distribution, and technology. The
spending plans discussed above are for Chevron as a stand-alone entity and do
not reflect the impact of the pending merger with Texaco. They also do
-4-
not include the acquisition of an additional 5 percent equity interest in the
Tengizchevroil project in Kazakhstan, which closed in January 2001.
Petroleum - Exploration and Production
Liquids and Natural Gas Production
The following table summarizes the company's and affiliates' net production of
crude oil, natural gas liquids and natural gas for 2000 and 1999.
Net Production* Of Crude Oil And Natural Gas Liquids And Natural Gas
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Crude Oil & Natural Gas
Natural Gas Liquids (Millions of
(Thousands of Barrels per Day) Cubic Feet per Day)
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2000 1999 2000 1999
- -------------------------------------------------------------------------------------------------
United States
-California 108.9 111.8 116.0 114.8
-Gulf of Mexico 116.0 104.7 784.5 790.0
-Texas 35.9 45.7 266.5 323.0
-Wyoming 11.0 10.0 154.6 170.3
-Other States 40.1 43.6 236.7 240.3
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Total United States 311.9 315.8 1,558.3 1,638.4
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Angola 159.5 145.6 - -
Nigeria 147.1 144.0 46.8 39.2
Canada 65.4 65.0 146.2 193.6
Argentina 51.1 13.4 50.8 8.8
Australia 41.4 30.4 223.0 227.1
United Kingdom (North Sea) 36.0 42.2 218.6 218.8
Congo 24.5 28.9 - -
Norway 15.3 15.8 0.7 0.4
Thailand 14.3 3.7 69.6 39.4
China 13.9 13.9 - -
Indonesia 12.6 17.0 - -
Papua New Guinea 10.8 15.2 - -
Democratic Republic of Congo 8.3 8.8 - -
Venezuela 4.1 2.5 - -
Colombia 1.1 11.4 - -
Netherlands - - 1.3 1.9
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Total International 605.4 557.8 757.0 729.2
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Total Consolidated Companies 917.3 873.6 2,315.3 2,367.6
Chevron's Share of Affiliates 241.3 253.4 153.8 145.0
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Total Including Affiliates 1,158.6 1,127.0 2,469.1 2,512.6
================================================================
* Net production excludes royalty interests owned by others.
In 2000, Chevron conducted its worldwide exploration and production operations
in the United States and approximately 25 other countries. Worldwide net crude
oil and natural gas liquids production, including that of affiliates but
excluding volumes produced under operating service agreements, increased for the
eighth consecutive year by nearly 3 percent from the 1999 levels. Net liquids
production in the United States fell slightly. International net liquids
production, including affiliates, increased by about 4 percent in 2000 - the
eleventh consecutive year of production increases. This increase was due
primarily to a full year of production in Argentina and Thailand following
acquisitions the company made in 1999; higher production from new fields in
Angola; and
-5-
higher production in Australia. These increases were partially offset by
production declines in Indonesia, Colombia and the United Kingdom.
Net production of natural gas, including affiliates, fell by 2 percent in 2000.
United States production fell about 5 percent, as normal field declines more
than offset new and enhanced production from the Gulf of Mexico shelf and
deepwater Gulf of Mexico. International volumes increased 4 percent in 2000.
Higher production from the Argentina and Thailand properties acquired in 1999
were slightly offset by lower production in Canada due to normal field declines.
Acreage
At December 31, 2000, the company owned or had under lease or similar agreements
undeveloped and developed oil and gas properties located throughout the world.
Undeveloped acreage includes undeveloped proved acreage. The geographical
distribution of the company's acreage is shown in the next table.
Acreage* At December 31, 2000
(Thousands of Acres)
Developed
Undeveloped Developed and Undeveloped
------------------- ------------------- ------------------
Gross Net Gross Net Gross Net
-------- -------- -------- -------- -------- --------
United States 4,759 3,288 2,728 1,593 7,487 4,881
-------- -------- -------- -------- -------- --------
Canada 21,709 12,361 1,377 504 23,086 12,865
Africa 20,345 6,705 216 79 20,561 6,784
Asia 12,239 5,636 208 57 12,447 5,693
Other International 30,715 13,616 1,199 300 31,914 13,916
-------- -------- -------- -------- -------- --------
Total International 85,008 38,318 3,000 940 88,008 39,258
-------- -------- -------- -------- -------- --------
Total Consolidated Companies 89,767 41,606 5,728 2,533 95,495 44,139
Chevron's Share in Affiliates 2,767 1,334 286 144 3,053 1,478
-------- -------- -------- -------- -------- --------
Total Including Affiliates 92,534 42,940 6,014 2,677 98,548 45,617
======== ======== ======== ======== ======== ========
*Gross acreage includes the total number of acres in all tracts in which the
company has an interest.
Net acreage is the sum of the company's fractional interests in gross
acreage.
Refer to Table III on pages FS-34 to FS-36 of this Annual Report on Form 10-K
for data about the company's average sales price per unit of oil and gas
produced, as well as the average production cost per unit for 2000, 1999 and
1998. The following table summarizes gross and net productive wells at year-end
2000 for the company and its affiliates.
-6-
Productive Oil And Gas Wells At December 31, 2000
Productive(1) Productive(1)
Oil Wells Gas Wells
------------------- --------------------
Gross(2) Net(2) Gross(2) Net(2)
-------- -------- --------- ---------
United States 23,452 11,715 4,515 2,154
-------- -------- --------- ---------
Canada 1,062 863 197 142
Africa 1,359 514 8 3
Other International 2,036 900 162 73
-------- -------- --------- ---------
Total International 4,457 2,277 367 218
-------- -------- --------- ---------
Total Consolidated Companies 27,909 13,992 4,882 2,372
Chevron's Share of Affiliates 8,304 4,120 273 75
-------- -------- --------- ---------
Total Including Affiliates 36,213 18,112 5,155 2,447
======== ======== ========= =========
Multiple completion wells included above: 690 390 384 234
(1)Includes wells producing or capable of producing and injection wells temporarily functioning as producing
wells. Wells that produce both oil and gas are classified as oil wells.
(2)Gross wells include the total number of wells in which the company has an interest. Net wells are the sum of
the company's fractional interests in gross wells.
Reserves and Contract Obligations
Table IV on pages FS-36 and FS-37 of this Annual Report on Form 10-K sets forth
the company's net proved oil and gas reserves, by geographic area, as of
December 31, 2000, 1999 and 1998. During 2001, the company will file estimates
of oil and gas reserves with the Department of Energy, Energy Information
Agency. Those estimates are consistent with the reserve data reported on page
FS-37 of this Annual Report on Form 10-K.
In 2000, Chevron's worldwide oil and equivalent-gas (BOE) barrels of net proved
reserves additions exceeded production for the eighth consecutive year, with a
replacement rate of 152 percent of net production, including sales and
acquisitions. Excluding sales and acquisitions, the replacement rate was 132
percent of net production. The following table summarizes the company's net
additions to net proved reserves of crude oil and natural gas liquids and
natural gas, compared with net production during 2000.
Reserves Replacement - 2000
Additions to Net BOE Reserves
Reserves Production Replacement %
------------------- ----------------- ------------ Memo:
Including
Liquids Gas Liquids Gas Sales and
(mmbbls)(1) (bcf)(2) (mmbbls)(1) (bcf)(2) Acquisitions
---------- ------- ---------- ------- ------------
United States 96.2 275.8 114.1 570.3 78% 68%
Africa 299.9 462.2 124.2 17.1 192% 297%
Other international(3) 245.8 661.2 185.7 316.3 148% 149%
--------- ------- -------- -------
Total Worldwide 641.9 1,399.2 424.0 903.7 132% 152%
========== ======= ======== =======
(1) mmbbls = millions of barrels
(2) bcf = billions of cubic feet
(3) Includes equity in affiliates
The company sells crude oil and gas from its producing operations under a
variety of contractual arrangements. Most contracts generally commit the company
to sell quantities based on production from specified properties but
-7-
certain gas sales contracts specify delivery of fixed and determinable
quantities. In the United States, the company is obligated to sell substantially
all of the natural gas produced and owned or controlled by the company in the
lower 48 states to Dynegy Inc. Outside the United States, the company is
contractually committed to deliver approximately 110 billion cubic feet of
natural gas through 2003 from Australian and U.K. reserves and approximately 375
billion cubic feet of natural gas post 2003 through 2020 from Australian
reserves only. Substantially all of these contracts include variable-pricing
terms. The company believes it can satisfy these contracts from quantities
available from production of the company's proved developed Australian and U.K.
natural gas reserves.
Development Activities
- ----------------------
Details of the company's development expenditures and costs of proved property
acquisitions for 2000, 1999 and 1998 are presented in Table I on page FS-33 of
this Annual Report on Form 10-K.
The table below summarizes the company's net interest in productive and dry
development wells completed in each of the past three years and the status of
the company's development wells drilling at December 31, 2000. A "development
well" is a well drilled within the proved area of an oil or gas reservoir to the
depth of a stratigraphic horizon known to be productive. "Wells drilling"
include wells temporarily suspended.
Development Well Activity
Wells Drilling Net Wells Completed(1)
-----------------------------------------------
At 12/31/00 2000 1999 1998
----------------- ------------ ------------ ------------
Gross(2) Net(2) Prod. Dry Prod. Dry Prod Dry
------ ---- ----- --- ----- --- ----- ---
United States 141 61 348 7 411 7 324 5
------ ---- ----- --- ----- --- ----- ---
Africa 9 3 39 - 18 - 38 1
Other International 24 13 128 - 42 - 33 2
------ ---- ----- --- ----- --- ----- ---
Total International 33 16 167 - 60 - 71 3
------ ---- ----- --- ----- --- ----- ---
Total Consolidated Companies 174 77 515 7 471 7 395 8
Equity in Affiliates 49 17 252 - 220 - 272 -
------ ---- ----- --- ----- --- ----- ---
Total Including Affiliates 223 94 767 7 691 7 667 8
====== ==== ===== === ===== === ===== ===
(1) Indicates the number of wells completed during the year regardless of when drilling was initiated. Completion refers to
the installation of permanent equipment for the production of oil or gas or, in the case of a dry well, the reporting of
abandonment to the appropriate agency.
(2) Gross wells include the total number of wells in which the company has an interest. Net wells are the sum of the
company's fractional interests in gross wells.
-8-
Exploration Activities
- ----------------------
The following table summarizes the company's net interests in productive and dry
exploratory wells completed in each of the last three years and the number of
exploratory wells drilling at December 31, 2000.
Exploratory Well Activity
Wells Drilling Net Wells Completed(1)
-----------------------------------------------
At 12/31/00 2000 1999 1998
----------------- ------------ ------------ ------------
Gross(2) Net(2) Prod. Dry Prod. Dry Prod. Dry
------ ---- ----- --- ----- --- ----- ---
United States 36 22 60 22 72 30 46 12
------- ----- ------ ---- ----- ----- ------ ----
Africa 5 2 - 2 1 2 7 2
Other International 17 7 14 16 7 9 9 8
------- ----- ------ ---- ----- ----- ------ --
Total International 22 9 14 18 8 11 16 10
------- ----- ------ ---- ----- ----- ------ --
Total Consolidated Companies 58 31 74 40 80 41 62 22
Chevron's Share in Affiliates 7 3 - - 1 - 2 -
------- ----- ------ ---- ----- ----- ------ ---
Total Including Affiliates 65 34 74 40 81 41 64 22
======= ===== ====== ==== ===== ===== ====== ===
(1)Indicates the number of wells completed during the year regardless of when
drilling was initiated. Completion refers to the installation of permanent
equipment for the production of oil or gas or, in the case of a dry well, the
reporting of abandonment to the appropriate agency.
(2)Gross wells include the total number of wells in which the company has an
interest. Net wells are the sum of the company's fractional interests in
gross wells.
"Exploratory wells" are wells drilled to find and produce oil or gas in unproved
areas and include delineation wells, which are wells drilled to find a new
reservoir in a field previously found to be productive of oil or gas in another
reservoir or to extend a known reservoir beyond the proved area. "Wells
drilling" include wells temporarily suspended. The company had $400 million of
suspended exploratory wells included in properties, plant and equipment at
year-end 2000, an increase of $26 million from 1999. Decreases in the United
States were more than offset by increases in Angola, China and Canada. The wells
are suspended pending a final determination of the commercial potential of the
related oil and gas fields. The ultimate disposition of these well costs is
dependent on: (1) decisions on additional major capital expenditures, (2) the
results of additional exploratory drilling that is underway or firmly planned,
and in some cases, (3) securing final regulatory approvals for development.
Details of the company's exploration expenditures and costs of unproved property
acquisitions for 2000, 1999 and 1998 are presented in Table I on page FS-33 of
this Annual Report on Form 10-K.
Review of Ongoing Exploration and Production Activities in Key Areas
- --------------------------------------------------------------------
Chevron's 2000 key upstream activities not discussed in Management's Discussion
and Analysis of Financial Condition and Results of Operations beginning on page
FS-2 of this Annual Report on Form 10-K are presented below. In addition to the
activities discussed, Chevron was active in other geographic areas, but these
activities were of less significance.
A) United States
United States exploration and production activities are concentrated in about
300 fields located in the Gulf of Mexico, Texas, the Rocky Mountains, California
and Alaska. Some of the company's more significant activities in the United
States are described below.
Chevron has interests in three deepwater developments in the Gulf of Mexico.
Genesis, Chevron's first deepwater operation, located in 2,600 feet of water,
began production in January 1999. Chevron is operator and has a 57 percent
interest in Genesis, which reached peak total production of 58,000 barrels of
crude oil and 86 million cubic feet of gas per day in September 2000. Average
total production for 2001 is estimated at 42,000 barrels of crude oil and 54
million cubic feet of gas per day. Chevron has a 40 percent interest in the
Gemini deepwater development located in Mississippi Canyon Block 292 in 3,400
feet of water. Initial production occurred in June 1999. Total production from
Gemini averaged 131 million cubic feet of gas per day in 2000. Typhoon is
-9-
Chevron's third deepwater development, in 2,000 feet of water, in the Gulf of
Mexico. Initial production from Typhoon is scheduled for third quarter 2001. The
platform will support production facilities for 40,000 barrels of oil and 60
million cubic feet of gas per day. Chevron is the operator with a 50 percent
interest.
An aggressive 2000 well drilling program in the Gulf of Mexico Shelf enabled the
company to develop opportunities to offset field declines in production to less
than 2 percent between years. Chevron has interests in the Viosca Knoll Trend in
the Gulf of Mexico shelf and in 2000 continued to focus on establishing
production from additional gas reservoirs. Total production increased from 70
million cubic feet of gas per day at the beginning of the year to 240 million
cubic feet of gas per day at year-end. Total production is expected to average
200 million cubic feet of gas per day in 2001. The 2001-2003 program will
provide continued exploration and development of the Viosca Knoll area.
Development of the Destin Dome area of the Norphlet trend offshore Florida
continues to be hampered by delays in obtaining regulatory approvals. A draft
environmental impact statement (EIS) was issued August 1999 by the governing
agencies indicating no significant environmental impacts had been found. In July
2000, Chevron and its partners in the Destin Dome development filed a lawsuit
against the federal government to recover exploration expenses and future lost
profits following continuing delays in obtaining the necessary development
permits.
Onshore California, Chevron continued to expand its use of thermal enhanced
recovery techniques to increase the production rate and the amount of oil
ultimately recoverable from fields in the San Joaquin Valley, with efforts
focused on the Cymric Field. Average 2000 production from the San Joaquin Valley
fields was 104,000 barrels of oil and 112 million cubic feet of gas per day.
B) Africa
Nigeria: Chevron's principal subsidiary in Nigeria, Chevron Nigeria Limited
(CNL), operates and holds a 40 percent interest in 11 concessions totaling 2.3
million acres, predominantly in the swamp and near offshore regions of the Niger
Delta. During 1999, CNL's onshore and swamp area concessions were renewed for a
second 30-year term. CNL's offshore concessions expire in 2008. The renewal
process for the offshore concessions is provided for under the same statute as
for the concessions renewed in 1999. Application for renewal must be made before
one year of a concession's expiration. Based on the requirements of Nigerian law
concerning concession renewal, as well as the prior industry and company
experience with renewals, the company fully expects renewal of the offshore
concessions to be approved. Chevron Oil Company Nigeria Limited (COCNL) holds a
20 percent interest in six concessions, covering 600,000 acres, operated by
Texaco. Chevron Petroleum Nigeria Limited (CPNL) oversees and manages new
venture activities in Nigeria. CPNL has a 30 percent interest in one deepwater
Niger Delta block operated by Elf. CPNL interests in Benue Basin blocks were
relinquished after the drilling of exploratory dry holes indicated a low
probability of hydrocarbon presence. Chevron participated in Nigeria's deep- and
ultra-deep water 2000 bid round. Chevron was awarded interests in three
deepwater oil prospecting licenses, one as operator with a 50 percent interest
and 30 percent non-operating interests in the other two. Chevron and its
partners expect to develop work programs for the three newly acquired blocks
during 2001.
Total 2000 production averaged 430,000 barrels of liquids per day from 33
CNL-operated fields and approximately 47,000 barrels of oil per day from the
COCNL fields. Both production amounts were slightly higher than 1999.
Processing capacity at the Escravos gas plant increased to 285 million cubic
feet per day with start-up of Phase 2 of the project in the fourth quarter 2000,
representing another significant step toward reducing flaring of natural gas.
Front-end engineering and design for Phase 3, which will expand gas-processing
capacity to 680 million cubic feet per day, is expected to begin during the
second quarter of 2001. Feasibility engineering and preliminary technical
evaluations are nearing completion for a Gas-to-Liquids (GTL) plant proposed for
construction in Escravos. The proposed 33,000 barrels-per-day Escravos project
is expected to be the first project to use the technology and operational
expertise of a global GTL joint venture between Chevron and Sasol Limited.
Chevron is the Managing Sponsor of a consortium of six energy companies that
plans to develop a 600-mile gas transmission pipeline to connect suppliers in
the Western Delta region of Nigeria to power generation and industrial customers
in Benin, Ghana, and Togo. Subject to successful negotiation of concession
conditions with the governments, commercial operations could commence by late
2003 or 2004.
-10-
Angola: The company is the operator of two concessions, Blocks 0 and 14, off the
coast of Angola's Cabinda Province. Block 0 is a 2,100 square-mile concession
adjacent to the Cabinda coastline in which Chevron has an approximate 39 percent
interest. Block 14 is a 1,560-square-mile deepwater concession located west of
Block 0, in which Chevron has a 31 percent interest.
Block 0 total crude oil production during 2000 averaged 448,000 barrels per day,
down from an average of 460,000 in 1999, mainly due to normal field declines.
Area A of Block 0 includes 23 major fields, with 15 fields currently producing.
In 2000, 35 development wells were completed in Area A. The Kungulo and Vuko
fields, part of the Area A Waterflood Major Project, achieved first injection
from a new water injection platform in May 2000. Area B includes six major
fields. The Kokongo, Lomba and the southern part of the Nemba Field have
undergone the initial stages of development and are currently on production. In
Area B, three additional infill wells in South Nemba resulted in 17,000 barrels
of oil per day of incremental gross production. An additional infill program was
initiated in Kokongo Field and will be completed during 2001. Future development
plans also include installation of the North Nemba production and gas injection
platform in 2001. North Nemba development drilling is expected to add over
40,000 barrels per day of gross production by 2002. Area C includes seven major
fields. The N'Dola and Sanha fields are currently on production.
Six fields have been discovered in Block 14 - Kuito, Landana, Benguela, Belize,
Tomboco and Lobito. The Kuito Field, Angola's first deepwater production,
averaged over 61,000 barrels of oil per day in 2000. Kuito is being developed
using a phased approach. Phases 1A and 1B well programs are complete and
construction activities have commenced on Phase 1C, with first oil scheduled for
the third quarter 2001. Tomboco and Lobito were two significant Block 14
discoveries made in 2000. These wells are located in the vicinity of three of
the previously discovered fields. The appraisal drilling program for the
Benguela, Belize and Tomboco Fields was completed in early 2000. Development
plans call for a centralized drilling and production platform for the Benguela
and Belize Fields. Tomboco will be a satellite to this facility. The impact of
the nearby Lobito Field, discovered and appraised in 2000, will be included in
engineering studies during 2001. Study of the Landana Field continues, with an
appraisal well planned in 2001.
Republic of Congo: Chevron has interests in three partner-operated license areas
- - Haute Mer, Marine VII and Mer Profonde Sud - in offshore Congo, adjacent to
Chevron's concessions in Angola. Net production from Chevron's concessions in
the Republic of Congo averaged about 25,000 barrels per day in 2000. In the
Marine VII permit area, where Chevron has an interest of about 29 percent in the
Kitina and Sounda Exploitation Permits, development of the Kitina Field
continued and total production averaged about 27,000 barrels of oil per day.
Further development work, including gas injection, is planned for 2001. In Haute
Mer, where Chevron has a 30 percent interest, development of the Nkossa Field
continued with the recompletion of several wells. Total production in the field,
operated by Elf Congo, averaged about 66,000 barrels of oil and liquefied
petroleum gas per day in 2000. Development planning for the Moho and Bilondo
fields in the Haute Mer license continues with a development decision expected
in mid-2001. Two wells were drilled in the Mer Profonde Sud exploration license
in 2000, resulting in one non-commercial oil discovery and one dry hole.
Continued participation in the permit, where Chevron has a 15 percent equity
interest, is currently being re-evaluated with a decision planned for early
2001.
Chad/Cameroon: Chevron is a 25 percent partner in a consortium comprised of
affiliates of ExxonMobil and Petronas in a project to develop the Doba oil
fields in southern Chad and construct a pipeline to the coast of Cameroon for
export of oil to world markets. This project is expected to cost approximately
$3.5 billion and have a 20- to 30-year life. First production is expected in
2004.
Equatorial Guinea: In May, 2000 Chevron entered into a Production Sharing
Contract with the Republic of Equatorial Guinea for Block L, located off the
coast of the island of Bioko. The work program has an initial period of five
years with two one-year extensions. A 3D seismic survey was initiated in
December 2000.
C) Other International Areas
Caspian Region: The Tengizchevroil (TCO) partnership, formed in 1993, includes
the Tengiz and Korolev oil fields located in western Kazakhstan. Chevron had a
45 percent interest in TCO in 2000. In January 2001, Chevron increased its
ownership interest in TCO to 50 percent. In 2000, total crude oil
production from the Tengiz Field increased for the seventh straight year,
averaging 229,000 barrels of oil per day. TCO completed a three-year
-11-
plant expansion project in 2000 to increase TCO's processing and export
capacity. The project will permit crude oil production to increase to
approximately 260,000 barrels per day - the average gross production rate
expected for 2001. TCO plans to bring the Korolev field on line in 2001 by
extending its existing gathering system.
The Caspian Pipeline Consortium (CPC) was formed to build a crude oil export
pipeline from the Tengiz Field to the Black Sea port of Novorossiysk at a
projected total cost of $2.6 billion. When completed, the CPC pipeline will
allow for the export of an initial capacity of 600,000 barrels of oil per day,
expandable to 1.5 million barrels per day with additional pump stations, tankage
and marine loading facilities. Chevron has a 15 percent ownership interest in
CPC, which remains on schedule for a mid-2001 start-up.
Europe: Chevron holds interests in four producing fields offshore the United
Kingdom and Norway: the Alba oil field, the Britannia gas condensate field, and
non-operated interests in Statfjord and Draugen. Total production from the Alba
Field averaged 80,000 barrels of crude oil per day in 2000. Chevron's interest
in Alba is approximately 21 percent. Total production from the Britannia Field
averaged 692 million cubic feet of gas per day and approximately 40,000 barrels
per day of condensate during 2000. Chevron has an approximate 30 percent
interest in Britannia and shares operatorship with Conoco. In Norway, the
Draugen Field, in which Chevron has a 7.56 percent interest, produced an average
of 203,000 barrels of oil per day in 2000. Statfjord, where Chevron has a 4.84
percent interest, produced an average of 180,000 barrels per day in 2000. In the
16th Licensing Round in April, Chevron was awarded three new high-potential
licenses in the Norwegian Sea - one as operator.
Canada: Total production from the Hibernia Field offshore Newfoundland, in which
Chevron holds an interest of about 27 percent, averaged approximately 144,000
barrels of crude oil per day in 2000, up from 100,000 barrels of crude oil per
day in 1999. Also offshore Newfoundland, the company operates and holds a 28
percent interest in the Hebron Field, where a delineation well completed in 2000
confirmed previous hydrocarbon reservoirs and tested a new reservoir. At Fort
Liard in the Northwest Territories, the K-29 discovery well came into production
in April 2000. A second well came into production in early November. Combined
December total production from the two wells averaged 108 million cubic feet per
day of natural gas and byproducts. Chevron holds a 43 percent working interest
in the Fort Liard pool. In the Mackenzie Delta region of northern Canada,
Chevron formed two new joint venture partnerships to conduct exploration over a
large area totaling more than one million gross acres. One partnership is with
BP Canada Energy and covers two exploration concessions. The second partnership
is with BP and Burlington Resources Canada Energy Ltd., and covers three
exploration leases. Also in 2000, construction began on mining, extraction and
upgrading facilities for the $2.4 billion Athabasca Oil Sands Project. The
project is expected to begin production in late 2002 and reach 155,000 barrels
of bitumen per day at peak production. The tar-like bitumen will be upgraded
into high quality synthetic oil using hydroprocessing technology. Chevron has a
20 percent working interest in the project.
Australia: Chevron's primary interests in Australia involve a number of joint
ventures. The largest is the North West Shelf (NWS) Project offshore Western
Australia, where Chevron has an approximate 17 percent interest. Average total
field production during 2000 from the North Rankin and Goodwyn fields in the NWS
project was 1.5 billion cubic feet of gas per day and 99,000 barrels per day of
condensate. Total oil production from the Wanaea/ Cossack, Lambert and Hermes
fields averaged 116,000 barrels per day in 2000. Liquefied petroleum gas (LPG)
production driven by the liquids-rich gas averaged 23,400 barrels per day in
these fields. During 2000 a number of Japanese customers agreed to terms on
Letters of Intent with the NWS partners, underpinning the proposed fourth
liquefied natural gas (LNG) train, which would increase LNG production by about
50 percent. Chevron's other major area of activity is in permit areas that
include the Barrow Island and Thevenard Island oil fields and the undeveloped
Gorgon area gas fields, southwest of the NWS fields. Chevron operates a number
of joint ventures with production facilities on Barrow Island and Thevenard
Island, with interests varying from 25 percent to 50 percent. Chevron assumed
operatorship of these areas from West Australian Petroleum Pty. Ltd. in late
1999. Total oil production from the Barrow Island and Thevenard Island oil
fields in 2000, averaged 25,000 barrels per day, with Chevron's share of
production being 6,600 barrels per day. In addition to the two major joint
ventures above, Chevron has interests in the northern Browse Basin, and three
new deepwater exploration permits in the offshore Canning Basin, near the NWS
joint venture acreage. Chevron's interests vary from about 17 percent to 25
percent. During 2000, Chevron continued to pursue the Australia Gas Pipeline
Project from Papua New Guinea to Queensland, Australia. This project will allow
commercialization of Papua New Guinea natural gas reserves and recovery of
substantial quantities of natural gas liquids (NGL).
-12-
Indonesia: Chevron's interests in Indonesia are managed by two affiliate
companies, PT Caltex Pacific Indonesia (CPI) and Amoseas Indonesia (AI). Chevron
owns 50 percent of both companies. CPI manages all of Chevron's interests in
four production sharing contracts in Indonesia. Chevron's net share of total
production of 705,000 barrels per day in 2000 was 158,000 barrels per day. CPI
continues to implement enhanced oil recovery projects to extract more oil from
its existing reservoirs. The Duri Field, under steamflood since 1985, is the
largest steamflood in the world. Currently 9 of 13 phases are under steam
injection, with the tenth phase scheduled for injection in late 2001. AI is a
power generation company that operates the Darajat geothermal contract area in
central Java and is constructing a cogeneration facility to support CPI's Duri
steamflood. AI's geothermal field continued to provide steam to the national
power company plant and a company-owned plant that produces electricity for the
Java power grid. Further expansion of the Darajat geothermal reservoir complex
is planned. The Darajat reservoir has proved reserves of steam to generate 350
megawatts for 30 years.
Thailand: Chevron operates Block B8/32 in the Gulf of Thailand. Chevron has an
approximate 52 percent interest in the 734,000-acre block. Chevron also holds a
33 percent interest in adjacent exploration blocks 7, 8 and 9, which are
currently inactive pending resolution of Thailand-Cambodia border issues. Block
B8/32 is currently producing oil and natural gas from two fields, Tantawan and
Benchamas. In December 2000, the Tantawan Field was producing at a rate of 38
million cubic feet of gas per day and 5,400 barrels of oil per day. The
Benchamas Field was producing at an average rate of 110 million cubic feet of
gas per day and 28,600 barrels of oil per day. In Block B8/32 development of the
Maliwan Field is under-way, with the Maliwan A platform installation and initial
production through the Benchamas facilities expected by November 2001. The
Government of Thailand awarded a Production License Area (PLA) for North
Jarmjuree in November 2000. Further delineation of the North Jarmjuree PLA is
planned in 2001.
Argentina: Chevron holds over 4.2 million acres of exploration and production
acreage in the Neuquen and Austral Basins of Argentina with working interest
shares ranging from about 18 to 100 percent in operated license areas. In
addition, Chevron holds a 14 percent interest in a major oil export pipeline
from the Neuquen producing area to the Atlantic coast. At year-end 2000,
properties in the Neuquen and Austral Basins were producing at total combined
rates of 91,000 barrels of oil-equivalent per day. During 2000, Chevron
strengthened its Neuquen Basin leasehold position by purchasing two exploration
permits and two production concessions from Alberta Energy Company. Chevron's
exploration and appraisal program in 2000 resulted in three oil and two gas
discoveries that added over 50 million barrels to Chevron's proved and probable
oil-equivalent reserves. Exploration plans include 15 wells and the acquisition
of more than 250,000 acres of seismic data in 2001.
Brazil: As part of a strategy to expand its deepwater prospects and other
interests in South America, the company acquired in 2000 a 65 percent interest
in, and was designated operator of, exploration block BM-S-7.. A 25 percent
non-operated interest was also acquired in exploration block BM-S-10. Both
blocks are located in the Santos area of the Salt Basin. These two blocks bring
Chevron's total exploration acreage in the Salt Basin to 4.1 million acres.
Seismic programs for blocks BCUM-100 and BC-20 commenced in 2000 and three
exploratory wells are planned for 2001. Chevron's interest in both these
Petrobras-operated blocks is 50 percent. Current plans for BM-S-7and BM-S-10 are
to acquire and evaluate geologic and seismic data in 2001 and 2002, with
drilling commencing in 2003.
Venezuela: Chevron and Petroleos de Venezuela, S.A. (PDVSA) formed an alliance
in 1995 to further develop the Boscan oil field and provide heavy crude oil to
Chevron in the United States through several independent supply agreements.
Chevron took over operations of the Boscan Field in 1996 under an Operating
Services Agreement and receives operating expense reimbursement and capital
recovery, plus interest and an incentive fee. Development drilling continued in
the Boscan Field, with 41 wells completed during 2000. Average production from
Boscan was at the 115,000 barrels-of-oil-per-day limit specified in the
Operating Services Agreement for the second half of 2000. Chevron also is the
operator and has a 27 percent interest in the LL-652 Field in Lake Maracaibo.
The LL-652 Field objective is to increase production over the next few years
through the application of secondary recovery technologies. LL-652 oil
production during 2000 averaged 16,500 barrels per day, up from an average of
9,700 in 1999.
-13-
Petroleum - Natural Gas Liquids
The company sells natural gas liquids from its producing operations under a
variety of contractual arrangements. In the United States, the majority of sales
are to the company's Dynegy Inc. affiliate, in which the company had an
approximate 26 percent interest at year-end 2000. Dynegy and Chevron have
entered into long-term strategic alliances whereby Dynegy purchases
substantially all natural gas and natural gas liquids produced by Chevron in the
United States, excluding Alaska, and supplies natural gas and natural gas
liquids feedstocks to Chevron's U.S. refineries and chemical plants. Outside the
United States, natural gas liquids sales take place in the company's Canadian
upstream operations, with lower sales levels in Africa, Australia and Europe. In
2000, U.S. sales volumes, including Chevron's share of Dynegy sales, comprised
about 70 percent of the company's total worldwide natural gas liquids sales
volume.
Chevron's total third-party natural gas liquids sales volumes over the last
three years were as follows:
Natural Gas Liquids Sales Volumes
(Thousands of Barrels per Day)
2000 1999 1998
------- ------ ------
United States 71 65 63
Canada 23 24 26
Other International 13 10 7
------- ------- ------
Total Consolidated Companies 107 99 96
Share of Dynegy Affiliate 111 91 87
------- ------- ------
Total including Affiliate 218 190 183
======= ======= ======
Petroleum - Refining
Based on refinery statistics published in the December 18, 2000 issue of The Oil
and Gas Journal, Chevron had the fourth largest U.S. refining capacity. The
company's 50 percent-owned Caltex Corporation affiliate owned or had interests
in 10 operating refineries: Australia (2), Thailand, Korea, the Philippines, New
Zealand, Singapore, Pakistan, Kenya and South Africa. In 2000, Caltex
relinquished its 4.75 percent interest in a second refinery in Thailand. In
1999, Caltex sold its interest in two Japanese refineries owned by Koa Oil
Company Limited.
Distillation operating capacity utilization in 2000, adjusted for sales and
closures, averaged 90 percent in the United States (including asphalt plants)
and 89 percent worldwide (including affiliate), compared with 91 percent in the
United States and worldwide in the prior year. Chevron's capacity utilization at
its U.S. fuels refineries averaged 94 percent in 2000, down slightly from 96
percent in 1999. Chevron's capacity utilization of its U.S. cracking and coking
facilities, which are the primary facilities used to convert heavier products to
gasoline and other light products, averaged 80 percent in 2000, up from 78
percent in the year earlier. The company processed imported and domestic crude
oil in its U.S. refining operations. Imported crude oil accounted for 70 percent
of Chevron's U.S. refinery inputs in 2000.
-14-
The daily refinery inputs over the last three years for the company's and its
Caltex affiliate's refineries are shown in the following table:
Petroleum Refineries: Locations, Capacities And Inputs
(Inputs and Capacities are in Thousands of Barrels Per Day)
December 31, 2000
-------------------
Operable Refinery Inputs
Locations Number Capacity 2000 1999 1998
--------------------------------------------------- ------ -------- ------ ------ -----
Pascagoula, Mississippi 1 295 313 328 246
El Segundo, California 1 260 219 211 218
Richmond, California 1 225 203 207 201
El Paso,(1) Texas 1 65 60 65 62
Honolulu, Hawaii 1 54 51 51 49
Salt Lake City, Utah 1 45 44 43 40
Other(2) 2 96 53 50 52
--- ------ ------ ------ -----
Total United States 8 1,040 943 955 868
--- ------ ------ ------ -----
Burnaby, B.C., Canada 1 52 51 52 50
--- ------ ------ ------ -----
Total International 1 52 51 52 50
--- ------ ------ ------ -----
Total Consolidated Companies 9 1,092 994 1,007 918
Equity in Caltex Affiliate(3) Various Locations 10 423 363 417 425
--- ------ ------ ------ -----
Total Including Affiliate 19 1,515 1,357 1,424 1,343
=== ====== ====== ====== =====
(1) Capacity and input amounts for El Paso represent Chevron's share.
(2) Refineries in Perth Amboy, New Jersey; and Portland, Oregon, which are
primarily asphalt plants. The Richmond Beach, Washington, plant ceased
operations in May 2000.
(3) Inputs for 1999 and 1998 include Koa Oil Co. Ltd. refineries. Interests sold in 1999. All capacities and inputs represent
Chevron's share of Caltex's equity interests in its affiliates.
Petroleum - Refined Products Marketing
Product Sales: The company and its Caltex Corporation affiliate market petroleum
products throughout much of the world. The principal trademarks for identifying
these products are "Chevron" and "Caltex." The company's Fuel and Marine
Marketing LLC (FAMM) affiliate, which was established in late 1998, markets
marine fuel and lubricating oils in approximately 100 countries worldwide.
Chevron has a 31 percent equity interest in FAMM.
The following table shows the company's and its affiliates' refined product
sales volumes, excluding intercompany sales, over the past three years. The
company's Canadian sales volumes consist of refined product sales, primarily in
British Columbia, by the company's Chevron Canada Limited subsidiary. The 2000
and 1999 volumes reported for "Other International" relate to international
sales of aviation and marine fuels, lubricants, gas oils and other refined
products, primarily in Latin America, Asia and Europe. The equity in affiliates'
sales consists of (1) the company's interest in Caltex, which maintains an
interest in about 7,800 service stations (of which about 4,700 are controlled by
Caltex), operating in more than 60 countries in the Asia-Pacific region, Africa
and the Middle East, and (2) the company's interest in FAMM.
-15-
Refined Products Sales Volumes
(Thousands of Barrels Per Day)
2000 1999 1998
--------- --------- --------
United States
Gasolines 683 667 653
Jet Fuel 257 234 247
Gas Oils and Kerosene 231 236 198
Residual Fuel Oil 47 64 56
Other Petroleum Products(1) 109 101 89
--------- --------- --------
Total United States 1,327 1,302 1,243
--------- --------- --------
International
Canada 61 60 58
Other International 30 36 130
--------- --------- --------
Total International 91 96 188
--------- --------- --------
Total Consolidated Companies 1,418 1,398 1,431
Chevron's Share in Affiliates(2) 678 736 610
--------- --------- --------
Total Including Affiliates 2,096 2,134 2,041
========= ========= ========
(1) Principally naphtha, lubes, asphalt and coke.
(2) 1999 and 1998 restated to conform to 2000 presentation
Retail Outlets: In the United States, the company supplies, directly or through
dealer and jobbers, more than 8,000 motor vehicle retail outlets, of which about
1,400 are company-owned or -leased stations, and about 600 aircraft and marine
retail outlets. The company's gasoline market area is concentrated in the
southern, southwestern and western states. According to the Lundberg Share of
Market Report, Chevron ranks among the top three gasoline marketers in 14
states, and is the top marketer of jet fuel and aviation gasoline in the western
United States.
The company has continued to take advantage of growing demand for convenience
goods and services. In 2000, non-fuel sales in company-operated stores increased
16 percent, compared with 1999.
In Canada - primarily British Columbia - the company's branded products are sold
in approximately 170 stations (mainly owned or leased).
-16-
Petroleum - Transportation
Pipelines: Chevron owns and operates an extensive system of crude oil, refined
products, chemicals, natural gas liquids and natural gas pipelines in the United
States. The company also has direct or indirect interests in other U.S. and
international pipelines. The company's ownership interests in pipelines are
summarized in the following table:
Pipeline Mileage At December 31, 2000
Wholly Partially
Owned Owned(1) Total
--------- -------- ---------
United States:
Crude oil(2) 2,666 461 3,127
Natural gas 487 33 520
Petroleum products 2,059 1,738 3,797
--------- --------- --------
Total United States 5,212 2,232 7,444
--------- --------- --------
International:
Crude oil(2) - 481 481
Natural gas - 180 180
Petroleum products - 616 616
--------- --------- --------
Total International - 1,277 1,277
--------- --------- --------
Worldwide 5,212 3,509 8,721
========= ========= ===-====
(1)Reflects equity interest in lines, except Dynegy Inc..
(2)Includes gathering lines related to the transportation function.
Excludes gathering lines related to the U.S. and international production
function.
Tankers: Chevron's controlled seagoing fleet at December 31, 2000, is summarized
in the following table. All controlled tankers were utilized in 2000. In
addition, at any given time, the company has 30 to 40 vessels under charter on a
term or voyage basis.
Controlled Tankers At December 31, 2000
U.S. Flag Foreign Flag
----------------------------- ------------------------------
Cargo Capacity Cargo Capacity
Number (Millions of Barrels) Number (Millions of Barrels)
------ ------------------- ----- -------------------
Owned 2 0.8 10 13.7
Bareboat Charter 2 0.5 15 20.5
Time-Charter - - 1 0.5
-- ---- -- -----
Total 4 1.3 26 34.7
== ==== == =====
Federal law requires that cargo transported between U.S. ports be carried in
ships built and registered in the United States, owned and operated by U.S.
entities and manned by U.S. crews. At year-end 2000, the company's U.S. flag
fleet was engaged primarily in transporting crude oil from Alaska to refineries
on the West Coast and Hawaii, refined products between the Gulf Coast and East
Coast, and refined products from California refineries to terminals on the West
Coast, Alaska and Hawaii.
The Federal Oil Pollution Act of 1990 requires the scheduled phase-out, by
year-end 2010, of all single hull tankers trading to U.S. ports or transferring
cargo in waters within the U.S. Exclusive Economic Zone. This has resulted in
the utilization of more costly double-hull tankers. By the end of 2000, Chevron
was operating a total of 16 double hull tankers. Chevron expects to take
delivery of two additional double-hull tankers in 2003, also to be operated
-17-
under long-term bareboat charters. The company is a member of many oil-spill
response cooperatives in areas in which it operates around the world.
At year-end 2000, two of the company's controlled international flag vessels
continued to be used as floating storage vessels in its upstream operations
offshore Cabinda Province, Angola. The remaining international flag vessels were
engaged primarily in transporting crude oil from the Middle East, Indonesia,
Mexico and West Africa to ports in the United States, Europe, and Asia. Refined
products also were transported by tanker worldwide.
Chemicals
In July 2000, Chevron combined most of its petrochemicals businesses with those
of Phillips Petroleum Co. to form Chevron Phillips Chemical Company (CPCC),
headquartered in Houston, Texas. Each company owns 50 percent of the joint
venture. CPCC owns or has joint venture interests in 34 manufacturing facilities
in the United States, Belgium, China, Saudi Arabia, Singapore, South Korea and
Mexico.
In November 2000, CPCC began operation of a 100,000 tons-per-year polystyrene
plant in China. Also in 2000, CPCC and its joint-venture partner, the Saudi
Industrial Venture Capital Group, achieved design capacity production at a
petrochemical complex in Saudi Arabia with production of 480,000 tons of benzene
and 220,000 of cyclohexane.
An olefins plant is under construction in Qatar and is expected to commence
production in mid-2002 with an annual capacity of 1.1 billion pounds of ethylene
and 1 billion pounds of polyethylene. CPCC has a 49 percent interest in this
facility with the Qatar General Petroleum Corp owning the remaining 51 percent.
Following the merger with Phillips Petroleum Co., Chevron retained its "Oronite"
fuel and lubricant additives business. Chevron Oronite owns five manufacturing
facilities in the United States, France, Singapore, Japan and Brazil and has
equity interests in facilities in India and Mexico.
The following table shows 2000 Chemicals revenues and net income and details on
manufacturing facilities as of December 31, 2000.
Chemicals Operations
Year ended December 31, 2000 At December 31, 2000
---------------------------- --------------------------------
Revenue* Net Income Manufacturing Facilities
($ Millions) ($ Millions) U.S. International
----------- ----------- --------------------------------
Consolidated operations $3,305 $ 163 1 4
Share of Affiliates (123) 23 13
---------
Total Income 40
========
*Includes intercompany sales and excludes income from equity affiliates.
Coal
The Company's wholly owned coal mining and marketing subsidiary, The Pittsburg &
Midway Coal Mining Co. (P&M), owned and operated four surface mines and one
underground mine at year-end 2000. The Sebree Mine in Kentucky, which was idled
in November 1998, was sold in 2000. P&M also owns an approximate 30 percent
interest in Inter-American Coal Holding N.V., which has interests in mining
operations in Venezuela.
Sales and other operating revenues in 2000 were $297 million from sales of 14.0
million tons of coal. The average selling price for coal from mines owned and
operated by P&M was $21.22 per ton in 2000, compared with $22.73 per ton in
1999. Earnings in 2000 were affected negatively by a union work stoppage for
several months during the year and operating and geologic complications at
certain mines. At year-end 2000, P&M controlled approximately
-18-
218 million tons of developed and undeveloped coal reserves, including
significant reserves of environmentally desirable low-sulfur fuel.
Electronic Commerce and Technology
In 1999, Chevron implemented a new growth initiative aimed at developing
business opportunities capitalizing on Internet Web technology. The company
established a subsidiary to leverage "e-business" opportunities in Chevron's
business units. Additionally, the new subsidiary is involved in the development
of new Internet "business to business" (B2B) ideas for use in the company's own
operations and for potential development with other outside investors.
Chevron also established a technology ventures unit during 1999. The company
makes equity investments in a broad portfolio of emerging technology companies
with expertise in information technology, materials sciences and biotechnology.
These investments are directed toward areas where the company could potentially
be a customer.
Because some of these investments in e-business and new ventures may be in new
or unproven technologies and business processes, ultimate success is not always
certain. Although not all initiatives may prove to be economically viable, the
company's overall investment in this area is not significant to the company's
consolidated financial position.
Research and Environmental Protection
Research: The company's principal research laboratories are in Richmond and San
Ramon, California and Houston, Texas. The Richmond facility engages in research
on new and improved refinery processes, develops petroleum and chemicals
products, and provides technical services for the company and its customers. The
San Ramon and Houston facilities conduct research and provide technical support
in geology, geophysics, and oil production methods such as hydraulics, assisted
recovery programs and drilling, including offshore drilling. Employees in
subsidiaries engaged primarily in research activities at year-end 2000 numbered
about 1,000. Chevron's research and development expenses were $171 million, $182
million and $187 million for the years 2000, 1999 and 1998, respectively.
Licenses under the company's patents are generally made available to others in
the petroleum and chemicals industries, but the company does not derive
significant income from licensing patents.
Environmental Protection: Virtually all aspects of the company's businesses are
subject to various federal, state and local environmental, health and safety
laws and regulations. These regulatory requirements continue to change and
increase in both number and complexity, and govern not only the manner in which
the company conducts its operations, but also the products it sells. Chevron
expects more environmental-related regulations in the countries where it has
operations. Most of the costs of complying with the myriad laws and regulations
pertaining to its operations are embedded in the normal costs of conducting its
business.
In 2000, the company's U.S. capitalized environmental expenditures were $171
million, representing approximately 7 percent of the company's total
consolidated U.S. capital and exploratory expenditures. The company's U.S.
capitalized environmental expenditures were $121 million and $192 million in
1999 and 1998, respectively. These environmental expenditures include capital
outlays to retrofit existing facilities, as well as those associated with new
facilities. The expenditures are predominantly in the petroleum segment and
relate mostly to air and water quality projects and activities at the company's
refineries, oil and gas producing facilities and marketing facilities. For 2001,
the company estimates U.S. capital expenditures for environmental control
facilities will be $179 million. The future annual capital costs of fulfilling
this commitment are uncertain and will be governed by several factors, including
future changes to regulatory requirements.
Further information on environmental matters and their impact on Chevron are
contained in Management's Discussion and Analysis of Financial Condition and
Results of Operation on page FS-4 of this Annual Report on Form 10-K. The
company's 2000 environmental expenditures, remediation provisions and year-end
environmental reserves are discussed on page FS-4 of this Annual Report on Form
10-K.
-19-
Item 2. Properties
The location and character of the company's oil, natural gas and coal properties
and its refining, marketing, transportation and chemicals facilities are
described above under Item 1. Business. Information in response to the
Securities Exchange Act Industry Guide No. 2 ("Disclosure of Oil and Gas
Operations") is also contained in Item 1 and in Tables I through VI on pages
FS-33 to FS-38 of this Annual Report on Form 10-K. Note 14, "Properties, Plant
and Equipment," to the company's financial statements is on page FS-25 of this
Annual Report on Form 10-K. It presents information on the company's gross and
net properties, plant and equipment, and related additions and depreciation
expense, by geographic area and operating segment for 2000, 1999 and 1998.
Item 3. Legal Proceedings
A. El Segundo Refinery - Oil Spill Penalty
The Los Angeles Regional Water Quality Control Board has proposed an
administrative civil penalty for a jet fuel spill to groundwater resulting from
a leak in an underground pipeline at the Company's El Segundo Refinery. The
Company has remediated the spill and taken preventive steps to reduce the risk
of future spills.
B. El Paso Refinery - Clean Air Act
The Texas Natural Resources Conservation Commission and Chevron Products Company
have agreed to enter into an Agreed Order with respect to alleged air violations
at Chevron's El Paso Refinery. The alleged violations that are the subject of
the Agreed Order have been corrected and the Company has agreed to pay an
administrative civil penalty of $102,500.
C. Rangely Field - Clean Water Act
Chevron Production Company, as operator of the Rangely Unit, and its working
interest partners, have agreed to pay a $750,000 civil penalty associated with
alleged clean water act violations associated with produced water and crude oil
spills at the Rangely Production facility in northwestern Colorado. In addition,
the Company and its partners have committed to spend approximately $3 million in
facility upgrades to reduce the risk of spills from the injection line leaks.
Chevron's share of these expenditures will be 60 percent. Chevron and its
partners, the U.S. EPA and the Department of Justice have agreed to resolve the
matter through a consent decree, which will govern issues associated with the
injection line installation and leaks over the next five years.
D. Richmond Refinery - VOC Emissions
The Company has entered into a Settlement Agreement with the Bay Area Air
Quality Management District with respect to alleged violations of the air
district's fugitive VOC emission rules at the Company's Richmond Refinery. The
alleged violations involve emissions from connectors within the refinery. The
Company has agreed under the Settlement Agreement to pay a penalty of $242,500
and has agreed to surrender two tons per year of emission reduction credits for
volatile organic compounds.
E. Salt Lake Marketing Terminal - Air Emission Controls
The Utah Division of Air Quality has proposed a civil penalty in conjunction
with the loading of gasoline into tanker trucks without certain air emission
controls. The Company is negotiating with the Division to resolve all issues
relating to the alleged violations.
Other previously reported legal proceedings have been settled, not pursued, or
the issues resolved as not to merit further reporting.
Item 4. Submission of Matters to a Vote of Security Holders
No matter was submitted during the fourth quarter of 2000 to a vote of security
holders through the solicitation of proxies or otherwise.
-20-
Executive Officers of the Registrant at March 1, 2001
Name and Age Executive Office Held Major Area of
Responsibility
- ------------------- ------------------------------ --------------------
D. J. O'Reilly 54 Chairman of the Board since 2000 Chief Executive Officer
Director since 1998
Executive Committee Member
since 1994
R. H. Matzke 64 Vice-Chairman of the Board Worldwide Exploration and
since 2000 and Production Activities
Director since 1997
President of Chevron Overseas
Petroleum Inc. from 1989 to 2000
Executive Committee Member
since 1993
D. W. Callahan 58 Executive Vice-President Chemicals, Coal,
since 2000 Human Resources,
Vice-President since 1999 Technology
President of Chevron Chemical
Company from 1999 to 2000
Executive Committee Member
since 1999
H. D. Hinman 60 Vice-President and Law
General Counsel since 1993
Executive Committee Member
since 1993
G.L. Kirkland 50 President of Chevron U.S.A. North American
Production Company since 2000 Exploration and
Executive Committee Member Production
since 2000
M. R. Klitten 56 Executive Vice-President Worldwide Refining,
since 2000 Marketing and
Vice-President since 1989 and Transportation
Executive Committee Member Activities,
since 1989 Global Procurement,
Real Estate,
Aircraft Services
P.J. Robertson 54 Vice-President since 1994 Overseas Exploration and
President of Chevron Overseas Production
Petroleum Inc. since 2000
Executive Committee Member
since 1997
J.S. Watson 44 Vice-President and Chief Finance
Financial Officer since 2000
Vice-President since 1998
Executive Committee Member
since 2000
P.A. Woertz 47 Vice-President since 1998 U.S. Refining, Marketing,
President of Chevron Products Logistics and Trading
Company since 1998
Executive Committee Member
since 1998
The Executive Officers of the Corporation consist of the Chairman of the Board,
the Vice-Chairman of the Board, and such other officers of the Corporation who
are either Directors or members of the Executive Committee, or are chief
executive officers of principal business units. Except as noted below, all of
the Corporation's Executive Officers have held one or more of such positions for
more than five years.
D.W. Callahan - Senior Vice President, Chevron Chemical Company - 1991
- President, Chevron Chemical Company - 1999
-21-
G.L. Kirkland - General Manager, Asset Management, Chevron
Nigeria Limited - 1996
- Chairman and Managing Director, Chevron
Nigeria Limited - 1996
- President, Chevron USA Production Company - 2000
P.J. Robertson - Executive Vice-President of Chevron U.S.A.
Production Company - 1996
- Vice-President, Chevron Corporation and
President of Chevron U.S.A. Production Company - 1997
J.S. Watson - President, Chevron Canada Limited - 1996
- Vice-President, Strategic Planning, Chevron
Corporation - 1998
- Vice-President and Chief Financial Officer,
Chevron Corporation - 2000
P.A. Woertz - President, Chevron International Oil Company - 1996
- Vice President, Logistics and Trading,
Chevron Products Company - 1996
- President, Chevron Products Company - 1998
PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
The information on Chevron's common stock market prices, dividends, principal
exchanges on which the stock is traded and number of stockholders of record is
contained in the Quarterly Results and Stock Market Data tabulations, on page
FS-11 of this Annual Report on Form 10-K.
Item 6. Selected Financial Data
The selected financial data for years 1996 through 2000 are presented on page
FS-39 of this Annual Report on Form 10-K.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The index to Financial Statements, Supplementary Data and Management's
Discussion and Analysis of Financial Condition and Results of Operations is
presented on page FS-1 of this Annual Report on Form 10-K.
Item 8. Financial Statements and Supplementary Data
The index to Financial Statements, Supplementary Data and Management's
Discussion and Analysis of Financial Condition and Results of Operations is
presented on page FS-1 of this Annual Report on Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
-22-
PART III
Item 10. Directors and Executive Officers of the Registrant
The information on Directors appearing on pages 4 through 9 of the Notice of
Annual Meeting of Stockholders and Proxy Statement dated March 21, 2001, is
incorporated herein by reference in this Annual Report on Form 10-K. See
Executive Officers of the Registrant on pages 21 and 22 of this Annual Report on
Form 10-K for information about executive officers of the company.
Item 405 of Regulation S-K calls for disclosure of any known late filing or
failure by an insider to file a report required by Section 16 of the Exchange
Act. This disclosure is contained on page 12 of the Notice of Annual Meeting of
Stockholders and Proxy Statement dated March 21, 2001 under the heading "Section
16(a) Beneficial Ownership Reporting Compliance," and is incorporated herein by
reference in this Annual Report on Form 10-K. Chevron believes all filing
requirements were complied with during 2000.
Item 11. Executive Compensation
The information on pages 13 through 22 of the Notice of Annual Meeting of
Stockholders and Proxy Statement dated March 21, 2001, is incorporated herein by
reference in this Annual Report on Form 10-K.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information on page 12 of the Notice of Annual Meeting of Stockholders and
Proxy Statement dated March 21, 2001 appearing under the heading "Directors' and
Executive Officers' Stock Ownership," is incorporated herein by reference in
this Annual Report on Form 10-K.
Item 13. Certain Relationships and Related Transactions
There were no relationships or related transactions requiring disclosure under
Item 404 of Regulation S-K.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) The following documents are filed as part of this report:
(1) Financial Statements: Page(s)
Report of Independent Accountants FS-12
Consolidated Statement of Income
for the three years ended December 31, 2000 FS-12
Consolidated Statement of Comprehensive Income
for the three years ended December 31, 2000 FS-12
Consolidated Balance Sheet at December 31,
2000 and 1999 FS-13
Consolidated Statement of Cash Flows
for the three years ended December 31, 2000 FS-14
Consolidated Statement of Stockholders' Equity
for the three years ended December 31, 2000 FS-15
Notes to Consolidated Financial Statements FS-16 to FS-32
-23-
(2) Financial Statement Schedules:
We have included on page 25 of this Annual report on Form 10-K,
Financial Statement Schedule II - Valuation and Qualifying
Accounts.
The Combined Financial Statements of the Caltex Group of Companies
are filed as part of this report.
Caltex Group of Companies Combined Financial Statements C-1 to C-20
All schedules for the Caltex Group are omitted because they are not
applicable or the required information is included in the combined
financial statements or notes thereto.
(3) Exhibits:
The Exhibit Index on pages 27 and 28 of this Annual Report on Form
10-K lists the exhibits that are filed as part of this report.
(b) Reports on Form 8-K:
(1) A Current Report on Form 8-K was filed by the company on December
21, 2000. In this report, Chevron announced a change in the
certifying accountant for the Chevron Profit Sharing/Savings Plan.
(2) A Current Report on Form 8-K was filed by the company on March 15,
2001. In this report, Chevron filed the company's 2000 audited
financial statements, Management's Discussion and Analysis of
Financial Condition and Results of Operations for 2000 and
Supplementary Data.
-24-
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS ($ MILLIONS)
Year ended December 31,
2000 1999 1998
----- ------ ------
Employee Termination Benefits:
- -----------------------------
Balance at January 1 $ 85 $ - $ -
Additions charged to costs and expenses - 220 -
Expenditures (85) (135) -
--------------------------------
Balance at December 31 $ - $ 85 $ -
================================
Allowance for Doubtful Accounts:
- -------------------------------
Balance at January 1 $ 43 $ 31 $ 33
Additions to allowance 31 66 3
Bad debt write-offs (23) (54) (5)
--------------------------------
Balance at December 31 $ 51 $ 43 $ 31
================================
Deferred Income Tax Valuation Allowance (1)
- ---------------------------------------
Balance at January 1 $ 452 $ 295 $ 439
Additions charged to deferred income tax expense 56 189 4
Deductions credited to deferred income tax expense (193) (32) (148)
--------------------------------
Balance at December 31 $ 315 $ 452 $ 295
================================
1 See also Note 15 to the consolidated financial statements on page FS-26.
-25-
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, on the 28th day of March
2000.
Chevron Corporation
By DAVID J. O'REILLY*
-----------------------------------------
David J. O'Reilly, Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated on the 28th day of March 2001.
Principal Executive Officers (And Directors) Directors
DAVID J. O'REILLY* SAMUEL H. ARMACOST*
- ---------------------------------------------- -------------------------------
David J. O'Reilly, Chairman of the Board Samuel H. Armacost
RICHARD H. MATZKE* SAM GINN *
- ---------------------------------------------- -------------------------------
Richard H. Matzke, Vice-Chairman of the Board Sam Ginn
CARLA A. HILLS *
-------------------------------
Carla A. Hills
J. BENNETT JOHNSTON*
-------------------------------
J. Bennett Johnston
CHARLES M. PIGOTT*
-------------------------------
Principal Financial Officer Charles M. Pigott
JOHN S. WATSON* FRANK A. SHRONTZ*
- ---------------------------------------------- -------------------------------
John S. Watson, Vice-President, Finance Frank A. Shrontz
and Chief Financial Officer
CARL WARE*
-------------------------------
Principal Accounting Officer Carl Ware
STEPHEN J. CROWE* JOHN A. YOUNG*
- ---------------------------------------------- -------------------------------
Stephen J. Crowe, Vice-President John A. Young
and Comptroller
*By: /s/ LYDIA I. BEEBE
---------------------------------------------------
Lydia I. Beebe, Attorney-in-Fact
-26-
EXHIBIT INDEX
Exhibit
No. Description
- -------- ----------------------------------------------------------------------
3.1 Restated Certificate of Incorporation of Chevron Corporation,
dated November 23, 1998, filed as Exhibit 3.1 to Chevron
Corporation's Annual Report on Form 10-K for 1998 dated March 31,
1999, and incorporated by reference herein.
3.2 By-Laws of Chevron Corporation, as amended November 23, 1998, filed as
Exhibit 3.2 to Chevron Corporation's Annual Report on Form 10-K for
1998 dated March 31, 1999, and incorporated by reference herein.
4.1 Rights Agreement dated as of November 23, 1998, between Chevron
Corporation and ChaseMellon Shareholder Services L.L.C., as Rights
Agent, filed as Exhibit 4.1 to Chevron Corporation's Current Report on
Form 8-K dated November 23, 1998, and incorporated herein by
reference.
4.2 Amendment No. 1 to Rights Agreement dated as of October 15, 2000,
between Chevron Corporation and ChaseMellon Shareholder
Services L.L.C., as Rights Agent, filed as Exhibit 4.2 to Chevron
Corporation's Registration Statement on Form 8-A dated
December 7, 2000, and incorporated herein by reference.
Pursuant to the Instructions to Exhibits, certain instruments defining
the rights of holders of long-term debt securities of the corporation
and its consolidated subsidiaries are not filed because the total
amount of securities authorized under any such instrument does not
exceed 10 percent of the total assets of the corporation and its
subsidiaries on a consolidated basis. A copy of such instrument will
be furnished to the Commission upon request.
10.1 Chevron Corporation Deferred Compensation Plan for Directors, as