6 north american exploration chevron

© 2011 Chevron U.S.A. Inc.

Chevron North America Exploration and Production Company

Lee Ann Wainwright Policy, Government & Public Affairs Raoul Martin Health, Environment & Safety Team Leader


Chevron Global Expertise & Experience

1

Industry leading safety performance

More than 60,000 employees worldwide

No. 4 largest integrated energy company in the world

2.73 million barrels a day in 26 countries

130 years producing oil and natural gas


Key 2012 Exploration Activity Unconventional

2


Business Drivers Why Marcellus?

  Most attractive shale gas play in North America –   Proximity to premier market

–   Low cost of finding and developing

–   Strong well performance

  Little to no reservoir risk in well-defined trend

  Technical challenges solved

  Desire a significant position in the “Game-Changer”

3


Marcellus Production is a “Game-Changer” Pipeline Flow and Regional Implications

  Huge resource base near high demand on east coast

  Reverses gas flow direction

  Rockies gas stays west

  Near major pipeline corridors

4

Regional / US Impact: Job creation, energy security, lower energy costs, increased revenues to states and income to private landowners.


What Chevron Gained from Atlas Acquisition

  Outstanding acreage position   Strong operating experience in shale

gas   Foundation for future acquisitions   Safe and environmentally responsible   Rapidly growing local workforce

5


What We Acquired Premier Acreage – A Future Legacy Asset

6

Michigan

Ohio

West Virginia

New York

Pennsylvania

  >710,000 Marcellus Shale acres

  623,000 net acres of Utica Shale

  60% operating interest in Reliance Industries JV

  49% non-operating interest in Laurel Mountain Midstream JV

  271,000 Antrim acres

  100,000 net acres of Collingwood/Utica Shale


Marcellus Overview

  714,000 net acres of Marcellus Shale

  60% operator of a Marcellus Shale joint venture with Reliance Industries

  49% non-operating interest in Laurel Mountain Midstream

  Recently completed $3 million, 30,000 ft2 addition to Smithfield office.

  Added 75 employees to AMBU in 2011

 Added over 200 employees so far in 2012

7


Shale Gas Center of Excellence Leveraging Chevron’s Expertise and World-Class Process

  Over 130 years of oil and gas operations experience to overcome environmental, safety, technical and project management challenges

  Deploying best practices and technology: –   Pad drilling and water management to minimize environmental impact –   Well “manufacturing” techniques to reduce costs –   Use of 3D seismic to optimize horizontal well path planning

  Expertise in horizontal drilling and cutting-edge completion techniques   Significant capability in land leasing and management   Strategic partnerships and dynamic collaboration to enhance value   Long-term / “Generational Commitment” to region

8


Shared Expectations

9

The economic benefit of shale gas development should not come at a cost to people or the environment. Chevron operates with an expectation that we share with the American people – the energy we need will be produced safely and reliably.


Safety Culture

Raoul Martin Construction and Water HES Team Lead


Culture

The set of shared attitudes, values, goals, and practices that characterizes an institution or organization

- m-w.com definition 5c

Chevron’s Vision: To be the global energy company most admired for it’s people, partnerships and performance. Key Chevron Values: •  Partnership •  Protecting People and the Environment


Culture Driving Results

12


AMBU: Proud but Dissatisfied

13

2010 2011 2012 Rate 4.27 2.09 1.11

0 0.5

1 1.5

2 2.5

3 3.5

4 4.5

TRIR

2010 2011 2012 Rate 2.13 0.3 0.048

0

0.5

1

1.5

2

2.5 DAFWR


Operational Excellence (OE): A Management System to Support the Culture

Operational Excellence (OE) is the Systematic Management of Process Safety, Personal

Safety and Health, the Environment, Reliability and Efficiency to achieve World-Class

Performance.

Stop Work Authority: Every individual, employee, contractor, or

visitor, on a Chevron location is responsible and obligated to stop work if there is any doubt around work being done safely. There are no

repercussions for stopping work.

The safety and health of our workforce (employees and contractors) and protection of the environment are core values,

and drive the way we do business everyday at AMBU.


Partnership: Business Partners

  Companies that provide high-quality goods and services with industry-leading safety and environmental performance

  Must also demonstrate the following “value-added” qualities: –   Cost management –   Reliability and consistency –   Financial viability –   Competitive pricing –   Customer focus –   Innovative business solutions

15


What is CHESM? The purpose of the Contractor Health Environment and Safety Management (CHESM) Process is to:   Ensure Chevron partners with companies that

share our values   Provide a consistent program to eliminate

health, environment and safety incidents and injuries among contractors

16


What is a CHESM Audit?   CHESM evaluates contractors to verify their HES Management System,

practices, and performance meet Chevron expectations –   applies to all contractors working within the control of Chevron AMBU. –   Applies to sub-contractors as well.

  The CHESM Audit includes: –   Pre-Audit meeting to explain Chevron’s expectations and share examples

of what is expected –   Chevron Safety Questionnaire completed by contractor –   Face to face reviews of all HES programs, policies, accountabilities and

work practices –   Onsite verification that these programs and policies are implemented in

the field   Each contractor is rated A, B, C, D or F.

–   Chevron focuses its work with A and B rated contractors.

17


Ongoing Support for Contractors

  Chevron will assign “contract owners” to manage the relationship and HES performance of each contractor. Meetings are held at least quarterly.

  Participation in the Business Partner Safety Improvement Council (BPSIC) –   Compromised of a AMBU Senior Level Manager and at least one Executive Level Manager

from selected high risk contractors. –   The goal is to develop strategies to assure safe work performance, thereby eliminating

incidents that can result in injuries, property damage, environmental releases or other negative impacts to workers, the public, and the environment.

  Participation in the Joint Health, Environmental, and Safety Improvement Team (JHESIT) –   Composed of HES representatives from contractors –   Evaluates incidents and areas of improvement throughout operations and develops

handbooks, best management practices, and safety alerts to aid in continual improvement

  Annual CHESM Forums –   All contractors invited –   Goal is to share lessons learned, successes, initiatives, and strategic plans to get alignment

between Chevron and contractors

18


Chevron AMBU Supplier Forum

  Current Suppliers – Morning Session.

  Topics Include – eProcurement, Category Management, Supplier Diversity, and a message from the AMBU Vice President.

  Summary Agenda:

  7:30am – Registration

  8:30am – Forum Activities

  10:30am – Networking With Chevron AMBU team.

  Prospective Suppliers – Afternoon Session.

  Topics Include – Global Energy Impact, Introduction to AMBU Supply Chain Management, and a message from the AMBU Vice President.

  Summary Agenda:

  12:30pm – Registration

  1:30pm – Forum Activities

  3:30pm – Networking With Chevron AMBU team.

19

To register for this event – Email [email protected] or Call 281-575-8155


Discussion

6 north american exploration chevron

Documents

marcellus shale acres

shale gas foundation

net acres of marcellus

shale gas center of

attractive shale gas

net acres of utica shale

natural gas

marcellus shale joint