heavy oil unlocking the potential

8/12/2019 Heavy Oil Unlocking the Potential

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Heavy OilUnlocking the Potential


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Today, heavy oil comprises 50 percent of known oil resources

but represents just one in ten barrels of production. New global

investment could double output by 2025, and as the worlds

premiere heavy oil developer, Chevron stands ready to help

develop this 8 trillion-barrel treasure.

Heavy Oil: Unlocking the Potential

with ChevronWith our unique expertise, specialized technologies, continuous investment

in long-term partnerships and a clear strategy to optimize the heavy oil value

chain, no company is better positioned than Chevron to unlock this global

potential.

We produce more than 500,000 barrels per day of heavy oil across our

global operations nearly 20 percent of our total daily net production and

our expertise in thermal technologies accounts for half of those barrels. Our

California and Indonesia steamflood operations lead the industry in recovery

and cost efficiency and we are pioneering carbonate steamflood in the

Middle East. With our expertise in heavy oil, were a top producer and upgrader

of extra-heavy oil in Venezuela, where we work to boost future production with

steam. We are a partner in a major extra-heavy oil mining and upgrading project

in Canada. And as a leader in offshore and deepwater development worldwide,

were unlocking heavy oils offshore potential across our global operations,

including deepwater reservoirs in Angola and Brazil.

Chevron integrates heavy oil development with oil marketing, upgrading and

refinery capabilities. Building on a heritage of leadership in refining, were

strategically investing in key facilities in North America and Asia to handle

the requirements of processing heavy crude. Continuing our history as a top

developer and licenser of heavy oil processing technologies, our company is

always seeking new ways to make valuable fuels from heavy oil feedstocks.

As the proven heavy oil partner of choice, we continually invest in upstream

and downstream research and development, and we transfer knowledge and

technology to help partners grow, maximize returns, create jobs and build local

economies. With a global commitment to safe and clean operations, we work

constantly to protect communities and the environment. Chevron is committed

to building long-term heavy oil partnerships to help countries commercialize

their unique assets and deliver essential new energy supplies to the world.

Heavy

Above:Chevron is automating and str

lining operations with the Master Sche

Visualizer and other improvements un

the companys global i-feldinitiative

Left:In 1985, Chevron transferred ste

flooding technology to Indonesias Du

Field, one of the worlds largest therma

projects, which has produced more tha

2 billion barrels of heavy oil. Building

upon decades of experience and partne

with the government of Indonesia, the

2000-well North Duri expansion targ

over 100 million incremental barrels.

Cover:Expansion loops in steam-distr

tion networks in Chevrons heavy oil o

tions in California, where the company

over 50 years of experience and contin

advance its industry-leading capabilitie

thermal production.

Throughout this publication, heavy oil is defined as 22 degrees API gravity or lower; with extra-heavy

10 degrees or lower.

Chevrons years of experience

advancing thermal heavy oil

technologies and systems.

50+

Heavy


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Chevrons World of Heavy Oil

World-Class Thermal

Production

Kern River, Midway Sunset,

other fields, California, U.S.;

Duri Field, Indonesia

Heavy Oil Training,

Research & Development

Chevron International Heavy Oil

Center, Bakersfield, and Richmond

Technology Center, Richmond,

California, U.S.

Horizontal Steam

Injection Test Facility

San Joaquin Valley, California, U.S.

Solar Steam Generation

Test Facility


Heavy Oil i-field


Heavy Oil Reservoir

Steam Fracturing

Projects

Cymric and Midway fields,

California, U.S.

.

Large-Scale Carbonate

Reservoir Steamflood

Pilot

Wafra Field, onshore Partitioned

Zone, located between the

Kingdom of Saudi Arabia and

State of Kuwait

Extra-Heavy Oil Surface

Mine & Upgrader

Athabasca Oil Sands Project,

Muskeg River, and ScotfordUpgrader, Alberta, Canada

12.

Extra-Heavy Oil Horizontal

Cold Production & Upgrader

Petropiar, Hamaca project,

Orinoco region, Venezuela

Heavy Oil Water Flooding

Petroboscan, Boscan Field,

Venezuela

14. Heavy Oil Production

Doba Field, Chad

Heavy Oil Field Appraisal

Petroindependencia, Orinoco

region, Venezuela

Offshore Production

Bohai Bay, China; Alba, Captain

and Clair fields, United Kingdom;

planned Hebron Field develop-

ment, Newfoundland, Canada

4.

Deepwater Production

Frade and Papa Terra fields,

Brazil; Kuito Field, Angola

Specialized Heavy

Crude Oil Refining

Pembroke Refinery, U.K.;

processes high-acid, high-

medium-heavy crudes from

Chevrons Captain and Clair

fields and other high-acid

North Sea crudes

Heavy Oil Refining

El Segundo, California;

Pascagoula, Mississippi; and

Salt Lake City, Utah, U.S.;

Yeosu, South Korea

Heavy Oil Marketing,

Trading, and Research

Development

Houston, Texas, U.S.

Heavy Oil Heavy

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Since being one of the pioneers of heavy oil field steamflooding

more than 50 years ago, Chevron has mastered thermal enhanced

recovery, a technology proven to dramatically increase recoverable

reserves. Like highly profitable resource factories, the companys

thermal projects continually apply creative solutions to improve

performance and build a persistent, long-term competitive advantage.

California, Indonesia thermalChevrons sandstone-reservoir

steamfloods in Kern River, California,

U.S., and Duri, Indonesia, have each

produced more than 2 billion barrels

of oil, with recovery rates up to 75

percent, compared to less than 10

percent without steam. Anchored by

large cogeneration plants producing

both power and steam, these special-

ized developments include thousands

of shallow wells for steam injection,

production and reservoir monitoring.

Reducing costs with technologyTo offset high development and oper-

ating costs of thermal projects, Chevron

employs continuous 3-D reservoir

modeling and characterization, well

surveillance, advanced steam-distri-

bution systems, and proprietary heat-

management expertise. Super-efficient,

optimized work flows and disciplined

maintenance of both underground and

surface facilities maximize reliability.

These technologies minimize energy

expense and precisely place both wells

and heat in the oil zones, creating a

distinct competitive advantage for

Chevron as demonstrated by our

industry-leading steam-oil ratios.

Chevron: The Thermal Enhanced

Recovery Leader

Heavy Oil

collaboration with the Kingdom of

udi Arabia and the State of Kuwait,

hevron is conducting the first large-

ale test of a conventional steamflood

a carbonate reservoir in the Wafra Field,

shore Partitioned Zone. Wafra could

d 100 million barrels of reserves for

ery 1 percent increase in recovery

om thermal stimulation.

Cold production technologiesChevron produces heavy oil both

onshore and offshore using cold

technologies where steam methods

are yet to be proven. In Venezuela,

powerful pumps and extra-long

horizontal wells are required to tap

reservoirs of extra-heavy crude. In

the onshore Partitioned Zone, water

injection enhances output at the

Wafra Field, also a prospect for future

steamflooding. Offshore in the U.K.

North Sea and China, and in deepwater

Brazil and Angola, Chevron captures

heavy crudes with waterflooding,

elaborate well completions and

down-hole pumps all adaptable for

development of untapped heavy

resources in other countries.

Investing in thermal R&DBuilding on a heritage of ingen uity,

Chevron continually invents and

adapts technologies to produce

heavy oil. As an example, we are

utilizing horizontal wells in steam-

floods leading to higher recovery

and significant new production. We

pioneered high-pressure, steam-

fracturing production in tight

diatomite reservoirs. Our new solar

steam generator in California will

save energy and reduce emissions

from operations. And we continue

to seek ways to thermally produce

the worlds deeper heavy oil deposits

unreachable by current steam

techniques.

Government and universityalliances

Under a leveraged technology strat

Chevron seeks to learn from and sh

with our partners governments,

universities, and national and inter-

national oil companies. We invest in

heavy oil research and developmen

with governments, including Canad

Indonesia, Kuwait, Saudi Arabia and

Venezuela, to explore new ways to

produce and optimize each country

resources. And we collaborate with

the University of Southern Californ

Stanford University and Texas A&M

among many others to digitally

automate heavy oil fields and test

ideas to produce heavy oil with

solution gas drive, in-situ combusti

solvent-assisted thermal recovery

and other experimental methods.

Heavy

Above Left:A critical component of Chevrons partnership to develop extra-heavy oil in Venezuela, this giant upgrader processes

raw output from the Hamaca Project to make up to 180,000 barrels of synthetic crude per day.

Above Center:Combining capital and expertise from Chevron Technology Ventures and BrightSource Energy, a new solar facility

will heat a tower-top boiler with 3,800 mirrors to supply up to 4 percent of steam for Chevrons Coalinga heavy oil field in California.

Above Right:In Indonesia and numerous other countries, Chevrons partnerships combine technology and skilled professionals to set

the international standard for heavy oil operations.


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Chevrons downstream heavy oil expertise has evolved in parallel

with our upstream capabilities. Today, with support from our

strategy, technology and commercial integration teams, production

and refining work together to optimize the heavy oil value chain.

Chevron is equipped to convert heavy oil into high-demand fuels

and is strategically well positioned for the long term as the world

relies more on heavy oil feedstocks.

Heavy oil refining

Chevrons refining network can process over 600,000 barrels of heavy crude and

residuum per day, including coking capacity well above the global industry average.

In the United States, our El Segundo Refinery integrated with our nearby heavy oil

production continues to upgrade its heavy oil processing capacity and flexibility.

In South Korea, Chevron is a 50 percent partner in the 840,000 barrel-per-day

Yeosu Refinery complex that is currently expanding its heavy oil capacity. And

our 350,000 barrel-per-day Pascagoula, Mississippi, refinery in the United States

is one of the worlds most advanced heavy oil processing facilities.

Processing technology leader

During the past 50 years, Chevron has built a broad portfolio of patented techniquesfor processing heavy crudes and residuum. Were a leader in catalyst research and

development and the premier global licenser of technologies for heavy feedstock

hydroprocessing and upgrading of extra-heavy crudes. We continue to advance this

capability with proprietary innovations such as Vacuum Resid Slurry Hydrocracking

(VRSH), a pre-commercial technology with the potential to significantly increase

yields of transportation fuels from ultra-heavy feedstocks.

Chevrons premier heavy oil refinery in Pascagoula, Mississippi, near the Gulf of

Mexico, is equipped to convert up to 350,000 barrels of heavy, high-sulfur crudes

per day into valuable fuels.

Downstream: The Integration Advantage

350,000 barrels

Heavy Oil Heavy


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Successful heavy oil projects require long-term relationships with

a financially strong partner committed to integrated, disciplined

development of this challenging resource. Currently, Chevrons

heavy oil partnerships include operations in Angola, Brazil, Canada,

Chad, China, Indonesia, the onshore Partitioned Zone, the United

Kingdom, the United States and Venezuela. At Chevron, a large,

integrated network of senior management, engineers, scientists

and other heavy oil experts throughout the world share information

and insights on improving results.

Chevron also brings to every partnership a proven capability to

optimize capital investment and profits through superior project

management and long-term, highly efficient operation of base

business assets. This is critical to success in heavy oil projects,

which often require large, front-end investments in specialized

infrastructure, wells and associated upgrading facilities, followed

by decades of labor-intensive field management. Working with

partners using leading-edge technologies, new reserves are

unlocked and costs reduced over time.

Partnership: Key to Heavy Oil Success

Heavy Oil

Training, development, promotion

Partnership means investing in people. In the United States, at our International

Heavy Oil Center in central California, in nearby oil fields and at the Chevron

Energy Technology Company in Houston, Texas, Chevron provides training and

experience to partners from many countries, including China, Indonesia, Kuwait,

Saudi Arabia and Venezuela. Within countries where we operate, we are

committed to hiring, training and promoting the local workforce, and providing

opportunities to expand their skills within Chevrons global o perations.

Chevrons own Heavy Oil Specialist Program a two-year course that expects

to graduate 50 early career employees during the next several years focuses

on heat management, field surveillance, steam distribution and other critical

heavy oil skills.

Technology transfer

Chevron shares heavy oil technologies and advanced work processes with its

long-term partners. We introduced thermal enhanced recovery in Indonesia in

1985. And today the Duri Field is a model of performance as the worlds largest

steamflood, employing thousands of Indonesians. In a similar transfer of technology

to Middle East partners, our large-scale pilot project at the Wafra Field in the

onshore Partitioned Zone is among the regions first major efforts to prove

steamfloodings vast potential to the area.

Protecting people and the environment

Guided by the Chevron Operational Excellence Management System, our heavy oil

projects place a high priority on the hea lth and safety of employees, contractors

and communities, and on protecting the environment. With safety programs in the

field, in facilities, on the road and in the office, were committed to zero incidents.

Our comprehensive Environmental, Social and Health Impact Assessment process

systematically seeks ways to enhance project benefits and minimize impacts to

environment, health and communities.

Helping communities The Chevron Way

The Chevron Way summarizes our companys values and guides our ac tions and

business decisions as we strive to be the global energy company most admired for

its people, partnership and performance. In countries where we operate, we invest

in communities to support priorities such as job creation, health care and education.

Heavy

Above:Chevron optimizes heavy oil

projects worldwide with deep expertise

subsurface imaging and reservoir mod

Left:Chevrons International Heavy O

Center at its showcase Kern R iver ther

project in California functions as a h

oil university for partners from China

Indonesia, Venezuela and other countr

n important production milestone

hieved at both the Kern River and

uri fields a result of the successful

ansfer of steamflooding technology.

2 billionbarrels


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Chevron Corporation

6001 Bollinger Canyon Road

San Ramon, CA 94583, USA

Produced by Global Upstream and Gas

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of the items discussed in this brochure are forward-looking statements about Chevrons

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performance and are subject to certain risks, uncertainties and other factors, some of

which are beyond our control and are difficult to predict. Therefore, actual outcomes and

results may differ materially from what is expressed or forecasted in such forward-looking

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which speak only as of the printing date of this brochure. Unless legally required, Chevron

undertakes no obligation to update publicly any forward-looking statements, whether as

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in the Chevron Annual Report on Form 10-K for the year ended December 31, 2009.

Recycled

Recyclable

At the refining end of the heavy oil value

chain, Chevron advances technologies such

as Vacuum Resid Slurry Hydrocracking

(VRSH), a patented process for converting

heavy feedstocks to clean fuels while

producing no coke.

heavy oil unlocking the potential

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