Market Overview

Chevron Announces $36.7B Capital and Exploratory Budget for 2013

Chevron Corporation (NYSE: CVX) today announced a $36.7 billion capital and exploratory investment program for 2013. Included in the 2013 program are $3.3 billion of planned expenditures by affiliates, which do not require cash outlays by Chevron.

“Consistent with long-stated strategies, we're investing in a portfolio of very attractive oil and gas projects that will deliver volume growth and real value to our stockholders,” said Chairman and CEO John Watson. “Next year's program supports several projects currently under construction, including our Australian LNG projects and United States deepwater developments. As these and other projects come online, we anticipate production will reach our 2017 goal of 3.3 million barrels per day. With our strong balance sheet and industry-leading producing margins, I further expect to continue our pattern of significant stockholder distributions.”

Approximately 90 percent of the 2013 spending program is budgeted for upstream crude oil and natural gas exploration and production projects. Another 7 percent is associated with the company's downstream businesses that manufacture, transport and sell gasoline, diesel fuel and other refined products, fuel and lubricant additives, and petrochemicals.

HIGHLIGHTS OF THE 2013 CAPITAL AND EXPLORATORY SPENDING PROGRAM

Chevron 2013 Planned Capital and Exploratory Expenditures Billions U.S. Upstream $ 7.5 International Upstream 25.5 Total Upstream 33.0 U.S. Downstream 1.4 International Downstream 1.3 Total Downstream 2.7 Other 1.0 TOTAL (Including Chevron's Share of Expenditures by Affiliated Companies) $ 36.7 Expenditures by Affiliated Companies (3.3 ) Cash Expenditures by Chevron Consolidated Companies $ 33.4

Upstream

Investment of $33 billion is planned for exploration and production activities, including major natural gas-related projects. Notable major capital investments include developments in Australia, Nigeria, the U.S. deepwater Gulf of Mexico, Kazakhstan, Angola and the Republic of Congo. Planned capital spending also is directed toward improving crude oil and natural gas recovery and reducing natural field declines for existing producing assets throughout the world.

In Australia, the Gorgon three-train LNG foundation project on Barrow Island has been under construction for three years and is approximately 55 percent complete.

A cost and schedule review has been completed, and the total cost estimate for the foundation project has increased from AU$43 billion (US$37 billion) to AU$52 billion (US$52 billion). Plant startup is planned for late 2014, leading to the first LNG cargo in the first quarter 2015. The factors contributing to the increased costs and schedule impacts include labor costs and productivity associated with Barrow Island site infrastructure, logistics challenges and weather delays. In addition, currency impacts due to the strengthened Australian dollar and changes in the mix of currencies since project sanction account for approximately one-third of the projected increase in U.S. dollar outlays.

“Gorgon project economics are attractive," said Vice Chairman George Kirkland. "While investment requirements have grown, oil prices, which directly impact the overall revenue stream, have increased by approximately 80 percent over the same time period. In addition, the LNG nameplate capacity has increased by 4 percent to 15.6 million tons per year.”

Kirkland added, "Our exploration program continues to discover additional gas resources that could support future expansions of our Australian LNG developments. The Wheatstone LNG project is currently 7 percent complete and is on budget and on schedule."

In the Gulf of Mexico, projects under development include Jack/St. Malo, Big Foot and Tubular Bells. The Jack/St. Malo and Big Foot projects are approximately 55 and 65 percent complete, respectively, and are on budget. First production for both of these projects is expected in 2014.

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