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16.12.2010

Chevron, Other Shareholders Sanction Caspian Pipeline Expansion

Chevron Corporation (NYSE:CVX) today announced that the shareholders and governing bodies of the Caspian Pipeline Consortium (CPC) have unanimously approved the $5.4 billion expansion of the Caspian pipeline. The capacity of the 900-mile (1500 km) pipeline, which carries crude oil from Western Kazakhstan to a dedicated terminal in the Black Sea, will increase to 1.4 million barrels per day from its current capacity of 730,000 barrels per day.

“Chevron appreciates the valuable contributions of our partners, Transneft and KazMunaiGaz, toward sanctioning of the CPC expansion project.”

“This important achievement was made possible by the leadership and support of the governments of Russia and Kazakhstan,” said Chevron Chairman and CEO John Watson. “Chevron appreciates the valuable contributions of our partners, Transneft and KazMunaiGaz, toward sanctioning of the CPC expansion project.”

The expansion of the CPC pipeline is a critical step forward to enabling the Tengiz expansion, one of the world’s largest oil fields with estimated recoverable reserves of 6 billion to 9 billion barrels. CPC will carry Tengiz crude oil and also transport oil from other Kazakh and Russian fields.

The project will be implemented in three phases with capacity increasing progressively from 2012 to 2015. The project will consist of the refurbishment of the existing five pump stations, the addition of 10 new pumping stations, the replacement of a 55-mile (88 km) section of the line, six new storage tanks and the addition of a third offshore mooring point at the Black Sea terminal, six miles (10 km) north of the Port of Novorossiysk.

The three largest CPC shareholders, Transneft, KazMunaiGaz (KMG) and Chevron, will provide project management services to the project. The project is in the final stages of construction contract negotiations with awards expected in the first quarter 2011.

Copyright 2010, Chevron. All rights reserved.

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