Chevron Corp. has upped its 2008 capital and exploratory spending program by 15%, with $4.8 billion set aside for its U.S. upstream program, which includes deepwater Gulf of Mexico (GOM) projects and natural gas development in the Piceance Basin of Colorado.
Overall, the producer plans to spend $22.9 billion worldwide. About $2.6 billion has been set aside for spending by Chevron’s affiliates, which do not require cash outlays by the company’s consolidated companies. About 75% of the spending program is for upstream oil and gas exploration and production projects worldwide. Another 20% is dedicated to the company’s downstream businesses. The total budget for expenditures in the United States is about $8 billion.
The “portfolio of projects” provide “the foundation for our company’s future growth,” said CEO Dave O’Reilly. “Much of our 2008 spending continues to be on large, multiyear projects aimed at increasing energy supplies to meet growing global demand and also improving efficiency and reliability.”
In the upstream, Chevron plans to spend $17.5 billion worldwide on exploration, production and natural gas-related projects. A “significant” portion relates to development projects that build on the company’s exploration results in recent years, including opportunities in the deepwater GOM and western Africa. Funding also is earmarked for further appraisal and evaluation of other prospective areas in the world’s major hydrocarbon basins.
“Our upstream investments are aimed at finding and developing oil and gas resources to increase production and help supply the increasing energy needs of world markets,” said George Kirkland, executive vice president of upstream and gas. “Production start-ups of major projects in 2008 are expected to include Blind Faith in the Gulf of Mexico and Agbami offshore Nigeria. We also anticipate significant production increases at the Tengiz Field, Kazakhstan, as facilities become fully operational in 2008.”
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