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Prospective Technology Developments Up to 2050 Bharat Srinivasan Managing Director, Technology Marketing 9th Arab Energy Conference Doha, Qatar May 9 –

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Presentation on theme: "Prospective Technology Developments Up to 2050 Bharat Srinivasan Managing Director, Technology Marketing 9th Arab Energy Conference Doha, Qatar May 9 –"— Presentation transcript:

1 Prospective Technology Developments Up to 2050 Bharat Srinivasan Managing Director, Technology Marketing 9th Arab Energy Conference Doha, Qatar May 9 – 12, 2010

2 © 2009 Chevron Corporation 2 Agenda Exploration &Production Exploration & Exploration Well Success EOR & Impacts on Recoverable Reserves Non-conventional Oil Production Renewables Strategy Refining and Clean Fuels Developments Driven by Innovation, Leveraged Strengths and Collaborative Partnerships

3 © 2009 Chevron Corporation 3 Chevron Profile 60,000 employees 11.6 billion BOE net proved oil and gas reserves 2.7 million BOE daily net production 2.2 million BPD refining capacity 15 fuels/lubes refineries + 2 upgraders 3 retail brands 25,800 retail outlets

4 © 2009 Chevron Corporation 4 Exploration and Production Exploration & Exploration Well Success EOR & Impacts on Recoverable Reserves Non-conventional Oil Production

5 © 2009 Chevron Corporation 5 Chevron in the Arab World Photographed in the Winter of 1937, Dammam No. 1 (right) and Dammam No. 7 (background) appeared as the only foreign bodies in an isolated desert landscape. By the following year, the discovery at Dammam No. 7 would establish Saudi Arabias potential as an oil-producing giant.

6 © 2009 Chevron Corporation 6 A Strong Worldwide Portfolio 11.6 BBOE Proved Reserves 2.7 MMBOED Net Production Capacity Asia-Pacific 700 MBOED Africa & Latin America 600 MBOED North America 750 MBOED Europe, Eurasia & Middle East 650 MBOED Areas of Operation

7 © 2009 Chevron Corporation 7 % Average Exploration Success Rate Consistent Exploration Success Year-End Mean Resource Estimates Key Resource Additions Cumulative Resources Added From Exploration BBOE Resource Adds

8 © 2009 Chevron Corporation 8 Technology: Key to Exploration Success 3D seismic/4D Horizontal, multi-lateral wells Completions Subsalt wells Supercomputers Visualization Geostatistics in reservoir models Record depth - drilling Record depth - production

9 © 2009 Chevron Corporation 9 Exploration and Production Exploration & Exploration Well Success EOR & Impacts on Recoverable Reserves Non-conventional Oil Production

10 © 2009 Chevron Corporation 10 Future Technologies Will Focus on Recovering More from Existing Fields Improved reservoir management practices Reliability and uptime De-bottlenecking operations Optimization and automation Capital efficiency and drilling costs Energy efficiency

11 © 2009 Chevron Corporation 11 Technology Drives EOR Performance Thermal Recovery – Most Successfully Applied EOR Method Steamflood – Increases reserves by a factor of 2-10 times compared to primary heavy oil recovery Mechanism Heavy Oil Recovery Primary5 - 15% Steam Flood % Post-SteamPre-Steam Oil Saturation Averages 55% Oil Saturation Averages 8% Typical oil saturated core in Duri Field, Indonesia Worldwide Chemical 1% N 2 1% CO 2 12% HC Misc 19% Thermal 67%

12 © 2009 Chevron Corporation 12 Collaboration & Innovation Drive Performance Applying Steamflood Experience to New Opportunities Industry/Institution Collaboration INTERSECT simulation capabilities for HO reservoirs i-field – collaborative, visual environment to optimize and transform production performance University of Texas –advancing the science of EOR IOC Collaboration PNZ Carbonate Steamflood Development – Kingdom of Saudi Arabia Petropiar (Hamaca) – Petroleos de Venezuela Duri – Indonesia Reservoir and heat management are critical Efficient operating practices lead to high recoveries Develop and transfer critical Organizational Capabilities Advanced technology, processes and best practices

13 © 2009 Chevron Corporation 13 Exploration & Production Exploration and Production Exploration & Exploration Well Success EOR & Impacts on Recoverable Reserves Non-conventional Oil Production

14 © 2009 Chevron Corporation 14 Long-Term Outlook Shows Growth in Unconventional Resources Unconventional Resources XHO, GTL, CTL and other resources such as Biomass, Hydrates, etc. alternate hydrocarbon resources will become increasingly important Overall Oil Supply (MMBD) NGLs, Condensate, etc. North America, Latin America, Asia-Pacific, and Europe Middle East, West Africa, and FSU Hydrocarbon Demand Hydrocarbon Demand – Grows from 85 MM BOED to 125 MM BOED over the next 25 years Total Oil Production Plateau Total Oil Production Plateau – At approximately 100 MM BOED the demand gap is filled by Unconventional Sources Heavy Oil Gas to Liquids Bio-Fuels Shale Oil Unconventional Liquids (MMBPD) Gap - Unconventionals Coal to Liquids

15 © 2009 Chevron Corporation 15 Global Heavy Oil Resources China Mexico Colombia UK Iran Indonesia Brazil Angola Argentina USA Lower 40 USA Lower 40 Venezuela Trinidad India Canada 1 Billion Barrels in Place Alaska Ecuador Peru Madagascar Nigeria Oman Saudi Arabia Australia Russia Kuwait Egypt Jordan E. Europe Italy Netherlands Turkey 10 Billion 100 Billion > 1 Trillion Heavy / Extra Heavy Oil-in-Place HEAVY 15% © 2009 Chevron Corporation 15 CONVENTIONAL 91% CONVENTIONAL 30% 9% UNCONVENTIONAL Heavy / Extra Heavy Oil Production EXTRA HEAVY / BITUMEN 55%

16 © 2009 Chevron Corporation 16 Chevrons Development of Heavy Oil Reserves ChinaChina AlbertaAlberta CaliforniaCalifornia VenezuelaVenezuela North Sea Arabian Gulf IndonesiaIndonesia AngolaAngola ChadChad BrazilBrazil San Joaquin Valley HamacaHamaca Partitioned Neutral Zone DuriDuri CanadaCanada Mining Offshore Primary Thermal BoscanBoscan Saudi Arabia PNZ Wafra South Umm Gudair South Fuwaris Humma ~ 500,000 BOPD (net) = largest amongst International Oil Companies account for almost half of the worlds thermal heavy oil production

17 © 2009 Chevron Corporation 17 Renewables Energy Strategy

18 © 2009 Chevron Corporation 18 Demand is Growing, All Sources will be Needed ,842 Million Tons of Oil Equivalent 240 Mmboe/d ,095 Million Tons of Oil Equivalent 320 Mmboe/d Refs: IEA World Energy Outlook % 2% 1% 26% 34% 21% 10%

19 © 2009 Chevron Corporation 19 Leveraging Our Assets Chevron pursues renewable energy technologies that Are similar to our core business Can be integrated into our existing asset base Enable our core business Can give us a competitive advantage

20 © 2009 Chevron Corporation 20 Areas of Focus Geothermal Advanced Biofuels Emerging Energy Energy Efficiency

21 © 2009 Chevron Corporation 21 Chevron Technology Ventures Biofuels Business Unit Chevron Technology Ventures manages Chevrons advanced biofuels research portfolio and the companys interest in Catchlight Energy External Research Collaborations Universities Government laboratories Industrial partners NGOs Internal R&D Feedstock supply and optimization Conversion technologies Fuel and combustion technology

22 © 2009 Chevron Corporation 22 Catchlight Energy Chevrons 50/50 joint venture with Weyerhaeuser to research, develop and commercialize the conversion of forest- based biomass into biofuels Weyerhaeuser Catchlight Energy Chevron Feedstocks at scale High-quality fuels Conversion technology

23 © 2009 Chevron Corporation 23 Going Forward Maintain leadership in energy efficiency Continue to narrow focus in advanced biofuels feedstocks and conversion technologies Continue to partner business units to investigate, develop and integrate innovative solutions Maintain emphasis on energy at scale

24 © 2009 Chevron Corporation 24 Refining Refining & Clean Fuel Production

25 © 2009 Chevron Corporation 25 Unconventional Liquid Fuels Demand

26 © 2009 Chevron Corporation 26 Conversion Capacity Needed – Crude/Resid to Diesel Courtesy : Purvin and Gertz Inc.

27 © 2009 Chevron Corporation 27 Deficit of Diesel/Gasoil in Middle East/North Africa (MENA) Market Outlets Europe and Asia Pacific (Deficit)/Surplus, Mt

28 © 2009 Chevron Corporation 28 Diesel Fuel Sulfur Levels MENA August 2008 Sources: (2008 specs) and Wood Mackenzie (future specs)www.unep.org 10 / / / / 2012 = 10 / / / ~2010 Middle East diesel sulfur specifications are tightening (limit ppm S/year)

29 © 2009 Chevron Corporation 29 Hydroprocessing as the Bridging Technology Challenges similar to Chevrons history Convert heavy, contaminated feedstocks to clean products economically, efficiently – led to hydroprocessing technology Even the non-conventionals need hydroprocessing Need continuing application and innovation of hydroprocessing as bridging, transitional refining technology to address shifts in supply/demand, public policy, ramp up of non-conventional-derived fuels Moderated by capital, GHG costs

30 © 2009 Chevron Corporation 30 How Hydroprocessing Fits In: An Upgrading Refinery Refineries use hydroprocessing to: Meet product quality specifications on transportation fuels Upgrade heavier oil into desired, clean fuels or feedstocks Remove contaminants to feed downstream units, e.g., for lubricants, Petrochemicals Transition to process non-conventional feedstocks, e.g., Coal to liquids derived, bio-mass derived oils New technologies such as Chevrons VRSH increase liquid yield

31 © 2009 Chevron Corporation 31 Hydroprocessing Technology for Downstream Performance Chevron has built broad capability in processing heavy, high- contaminant crudes and residuum to clean products US Refineries – Over 40 years of hydroprocessing with more than 40 units currently operating UK Refinery – Innovative processing techniques for processing difficult crudes S. Korea Refinery – Upgrading to increase flexibility, reduce crude cost, and upgrade to diesel and lubricant base oils with advanced hydroprocessing, including ISOCRACKING, ISODEWAXING and LC-FINING technologies Through JVs, Chevron markets hydroprocessing technologies and catalysts

32 © 2009 Chevron Corporation 32 Hydroprocessing Technologies marketed by Chevrons Joint-Ventures

33 © 2009 Chevron Corporation 33 Announced Capacity Increases May Solve Most of the ME HCR Capacity Shortage Capacity IncreaseNew CapacitiesHCR, % CDU CountryCDUHCRCDUHCRPreviousNew Bahrain ,000 60, % Iran 150, ,601, ,5009.4%8.5% Iraq 750,000 96,500 1,347, , %12.3% Israel - 65, ,000 65,0000.0%29.5% Jordan ,400 4,3504.8% Kuwait 679,000 70,000 1,568, , %11.8% Oman 330, , % Qatar 250,000 76, ,000 96, %21.3% Saudi Arabia 800, ,000 2,880, ,8206.0%10.7% Syria 350, ,865 26, %4.5% UAE 600,000 37,000 1,381,250 68,0504.0%4.9% Yemen , % Algeria 300,000 78, ,000 78,0800.0%10.4% Egypt 140,000 44, ,250 77,5004.6%8.9% Eritrea , % Libya 240,000 50, ,000 50,7400.0%8.2% Morocco 200,000 38, ,901 38,0000.0%10.7% Sudan , % Tunisia 120, , % Future Mid-East hydroprocessing capability will grow to meet Global needs

34 © 2009 Chevron Corporation 34 Innovation Drives Performance VRSH – Refinings Future Vacuum Resid Slurry Hydrocracking (VRSH) technology - a unique resid conversion process for turning Vacuum Resid into high valued products Converts nearly 100% vacuum resid into clean burning fuels Yields high value products (>80% diesel and lighter & <20% VGO) Liquid yield %, no coke R&D pilot continues to improve the process and reduce technology risk Focus on optimizing catalyst formulation & operating flexibility

35 © 2009 Chevron Corporation 35 Summary Our comprehensive Environmental, Social and Health Assessment process applies leading technologies to reduce environmental, social and health impacts and risks from our activities Upstream, Renewables, Refining Technology Developments for the Mid-East and Chevron will depend on: Innovation Leveraged strengths Collaboration/Partnerships


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