wellsafe –chevron’s well control assurance program

© 2018 Chevron Chevron Confidential – For Internal Use Only

WellSafe – Chevron’s Well Control Assurance Program

Marcel RobichauxChevron, UC D&C Assurance GM

2© 2019 Chevron U.S.A. Inc. – All Rights Reserved

This document contains Chevron U.S.A. Inc.’s confidential and proprietary information. Any use of this

document without express, prior, written permission from Chevron U.S.A. Inc. and/or its affiliates is

prohibited.

Cautionary StatementCAUTIONARY STATEMENT RELEVANT TO FORWARD-LOOKING INFORMATION

FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This presentation of Chevron Corporation contains forward-looking statements relating to Chevron’s operations that are based on management’s current expectations, estimates and projections about the

petroleum, chemicals and other energy-related industries. Words or phrases such as “anticipates,” “expects,” “intends,” “plans,” “targets,” “forecasts,” “projects,” “believes,” “seeks,” “may,” “could,” “schedules,”

“estimates,” “may,” “could,” “should,” “budgets,” “outlook,” “on schedule,” “on track” 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, many of which are beyond the company’s control and are difficult to predict. Therefore, actual outcomes and results may

differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of

this presentation. 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 important factors that could cause actual results to differ materially from those in the forward-looking statements are: changing crude oil and natural gas prices; changing refining, marketing and

chemicals margins; the company’s ability to realize anticipated cost savings and expenditure reductions; actions of competito rs or regulators; timing of exploration expenses; timing of crude oil liftings; the

competitiveness of alternate-energy sources or product substitutes; technological developments; the results of operations and financial condition of the company’s suppliers, vendors, partners, and equity

affiliates, particularly during extended periods of low prices for crude and natural gas; the inability or failure of the company’s joint-venture partners to fund their share of operations and development activities;

the potential failure to achieve expected net production from existing and future crude oil and natural gas development projects; potential delays in the development, construction or start-up of planned projects;

the potential disruption or interruption of the company’s operations due to war, accidents, political events, civil unrest, severe weather, cyber threats and terrorist acts, crude oil production quotas or other

actions that be imposed by the Organization of Petroleum Exporting Countries, or other natural or human causes beyond its control; changing economic, regulatory and political environments in the various

countries in which the company operates; general domestic and international economic and political conditions; the potential liability for remedial actions or assessments under existing or future environmental

regulations and litigation; significant investment or product changes required by existing or future environmental statutes, regulations and litigation; significant operational, investment or product changes

required by existing or future environmental statutes and regulations, including international agreements and national or reg ional legislation and regulatory measures to limit or reduce greenhouse gas

emissions; the potential liability resulting from other pending or future litigation; the company’s future acquisition or disposition of assets and gains and losses from asset dispositions or impairments;

government-mandated sales, divestitures, recapitalizations, industry-specific taxes, changes in fiscal terms or restrictions on scope of company operations; foreign currency movements compared with the U.S.

dollar; material reductions in corporate liquidity and access to debt markets; the effects of changed accounting rules under generally accepted accounting principles promulgated by rule-setting bodies; the

company’s ability to identify and mitigate the risks and hazards inherent in operating in the global energy industry; and the factors set forth under the heading “Risk Factors” on pages 21 through 23 of the

company’s 2015 Annual Report on Form 10-K. In addition, such results could be affected by general domestic and international economic and political conditions. Other unpredictable or unknown factors not

discussed in this presentation could also have material adverse effects on forward-looking statements.

Certain terms, such as “unrisked resources,” “unrisked resource base,” “recoverable resources,” and “oil in place,” among others, may be used in this presentation to describe certain aspects of the company’s

portfolio and oil and gas properties beyond the proved reserves. For definitions of, and further information regarding, these and other terms, see the “Glossary of Energy and Financial Terms” on pages 50 and

51 of the company’s 2015 Supplement to the Annual Report and available at Chevron.com. As used in this report, the term “pro ject” may describe new upstream development activity, including phases in a

multiphase development, maintenance activities, certain existing assets, new investments in downstream and chemicals capacity, investment in emerging and sustainable energy activities, and certain other

activities. All of these terms are used for convenience only and are not intended as a precise description of the term “project” as it relates to any specific government law or regulation.

3© 2018 Chevron. All rights reserved.

My Journey

Barrios Well

Services

Shell Oil Co.

Conoco

Chevron

Through High School ‘74

1974–1979

GOM

1979–2004

GOM, UK, UAE, Wy, GOM, HQ

2004–present

DWEP GM D&C,

UC GM D&C Assurance

Started degree

Finished degree

4© 2018 Chevron. All rights reserved.

Macondo – April 20th, 2010 - Lest We Forget

5© 2018 Chevron Chevron Confidential – For Internal Use Only

Areas of Operations

OBJECTIVESPRESENTATION

WellSafe – Journey to-date

WellSafe – Why We Developed

WellSafe – Program Overview

Areas We Operate Across The Globe

© 2015 Chevron 6

We Didn’t Know

▪ We didn’t think a Macondo could happen, but we

didn’t know

▪ Funiwa, Frade, were reminders of our vulnerability

▪ We investigated high-reliability organizations (HRO’s)

to learn about industries where failure is not an option

▪ Incremental change was not going to be enough to

ensure different results…we needed a step-change

© 2015 Chevron 7

Developed By Chevron D&C, for Chevron D&C

WellSafe

Concept

Developed and

Patterned after

USN SUBSAFE

MARCH 2, 2012

A CERTIFICATION

PROGRAM THAT PROVIDES

THE MAXIMUM

REASONABLE ASSURANCE

THAT WELL CONTROL WILL

BE MAINTAINED AT ALL

TIMES

FOCUSED STRICTLY ON:

INFLUX PREVENTION,

DETECTION, CONTROL

WELL CONTROL

PROCEDURES

WELL CONTROL

COMPETENCY

WELL CONTROL EQUIPMENT

© 2015 Chevron

8

Casin

g /

Tu

bin

g D

esig

n

Pri

ma

ry

Cem

en

tin

g

Ba

rrie

rs

Casin

g &

Fo

rma

tio

n

Te

stin

g

Well

Co

llisio

n

Avo

ida

nce

Su

rfa

ce

Wellh

ea

d /

Tre

e

Su

bse

a

Wellh

ea

d

Well

Co

ntr

ol

Re

qu

ire

me

nt

BO

P

Eq

uip

me

nt

Te

stin

g

Lo

ss

Cir

cu

latio

n

Dis

pla

ce

me

nts

& S

OP

In

flo

w

Te

st

Ris

erl

ess

Dri

llin

g

We

ll D

esig

n/P

lan

Ce

rtific

atio

n

We

ll E

xe

cu

tio

n

Ce

rtific

atio

n

Rig

Cert

ific

ation

WellSafe

Certified

WellSafe Authority – (Internal Chevron Regulator)

WellSafe BU Certification

Upstream Capability Drilling & Completions

Leadership

Accountability and

Commitment - Makes

This Work

Design for Control, Guarantee Containment

© 2015 Chevron

This Is Our License to Operate

9

• Maintaining control of our wells is our

license to operate – with Shareholders,

Regulators, Business Partners and with

the Public

• Well Control is all about very deliberate

action – The motto is a call to action not

an aspirational feel good statement.

• Well Control begins long before wellsite

operations commence

Design for Control

Guarantee Containment

© 2018 Chevron U.S.A. Inc. All Rights Reserved. Company Confidential. 10

98.9

99.6

99.8

99.5

130

95

54

29

0

30

60

90

120

150

98.4

98.6

98.8

99.0

99.2

99.4

99.6

99.8

100.0

2016 2017 2018 2019 Q1

Num

ber

of “N

ot M

ets

”

Perc

en

t M

et

Execution Assurance Percent “Met”

(+68,000 Items)0.29

0.26

0.15

0.1

0.05

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

2015 2016 2017 2018 2019 Q1

Tier 1-3 Well Control Events / 100 Operations

(105 Events)

WellSafe Results – We’re Transitioning from:

“I Think I Know” to “I Know I Know”

Success Through WellSafe Assurance Process:• Rig Certification

• Well Design & Plan Certification

• Execution Assurance Requirements

• Quarterly & Annual Assessments

• External Assessments

• Well Control Drills (DrillPad)

• Cultural Shift BUT !!!

© 2015 Chevron

▪ WCE - Single barrier (FOSV) started leaking while conducting workover.

▪ WCE - Unexpected geological event causing significant well control event and then resulted in P&A.

▪ WCE - Failure to recognize / detect kick resulting in surface LOC and P&A from complicated well kill.

▪ Wrong Rams…program stated 3.1/2” x 5.1/2” VBR’s but BOP had 2.7/8” x 5” VBR’s.

▪ Wrong Rams….program required 9.5/8” casing rams, program & EAR mistakenly specified 7” casing rams.

▪ Wrong Rams….program / EAR Checklist stated to change out 9-5/8” casing ram…..Toolpusher requested

different configuration and DSM agreed without informing town…..MOC never raised

▪ Wrong Rams…..VBR’s in BOP for running Upper Completion were a different size to well program and

EAR checklist

▪ Wrong Element…..A non-API annular element was installed on Rig.

▪ Wrong Test…..Program required full BOP Test on nipple up. Rig only conducted connection test.

11

Chronic Unease RemainsRecent Examples of Well Control Events and “Near-Misses”

© 2018 Chevron U.S.A. Inc. All Rights Reserved. Company Confidential. 12

Kick Volume vs Time

© 2015 Chevron

WellSafe – Important Journey

13

▪ WellSafe is a topic of conversation

in every Business Unit every day

▪ Chronic Unease is becoming more

prevalent amongst the work force

▪ We know (and want to know) where

our gaps are


Moving from “We Think” to “We Know”

DrillPad

• Manages the planning, execution and

assessment of multiple well control drills

• Used to establish the competency and

improve the proficiency of the rig crews

• Provides the ability to verify well control

competency

Well Control Drills and DrillPad

®


Well Control Drills

• The goal of DrillPad is to facilitate building individual

and crew well control competency and proficiency

everywhere we operate


Expectations of our Drill / Well Site Representatives

•Use Plan, Brief, Execute, Debrief

(PBED)

•DSR and senior contractor plan drill

together

• It’s a teaching, learning and

leadership opportunity

•Evaluation of drill is critical

•Debrief with crew is critical to build

competency


Example of DrillPad Selected Drill’s

© 2018 Chevron U.S.A. Inc.

• We’re far from perfect, our journey is showing improvements

• We’re much better today than we were five years ago.

• We continue to learn, and know where the issues are to manage and

correct them

• We’re working to protect the company’s reputation

What I’ll Leave With You

This journey has no end!

wellsafe –chevron’s well control assurance program

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