Witsml Meeting May 2005

1. “To be the global energy company most admired for its people, partnerships, and performance.” Energy Technology CompanyPartners Creating Value Witsml Meeting May 2005

2. 180 countries 47,000 employees (moving to 53000) US $8.5 Billion capitalbudget Global Business – Global Technology.TechnologyCompanies support every CVX SBU • 11.9 billion BOE oil and gas reserves (moving to 13.7) • 2.6 million BOE daily net production (moving to 3.0) ChevonTexaco Headquarters Exploration Refining Chemicals Power Technology • 4th largest publicly traded integrated oil in the world based on OE reserves and production, soon to be 3rd !!

3. ChevronTexacoTechnology Companies Supports CVX Performance Dimensions Profitable Growth Cost Reduction Operational Excellence Capital Stewardship #1 in TSR Organizational Capability

4. CVX 20-Year Strategic PlanLeveraging Technology ETC ITC CTTV • “The technology strategies enable us to: • achieve and maintain world-class 4+1 performance, • compete in future energy markets, • recruit and retain key technical talent. • “Sharing accountability with the operating companies, the technology organizations will continue to closely align their technology efforts with business objectives by concentrating on the focus areas most important to the company's success”

5. Energy Technology Company (ETC) Organization President Mark Puckett Executive Assistant Robbyn Edman Finance Ken Isaksen Strategic Research Manager June Gidman Human Resources Cynthia Bozman Process & Equipment TechnologyGeneral Manager Paul Allinson Business Planning & SupportGeneral Manager Bob Dastmalchi Catalyst General Manager Georgie Scheuerman Drilling & Production SystemsGeneral Manager Randy Kubota Integrated Laboratory TechnologiesGeneral Manager Jeff Hedges Health, Environment & Safety General Manager K. C. Mathew Subsurface CharacterizationGeneral Manager Bob Laing Reservoir Performance Optimization General Manager Janeen Judah Technical Computing General Manager &ETC CIO Peter Breunig

6. Energy Technology CompanyBusiness Fundamentals Role is an internal technology provider and integrator & supplying differentiated energy technology solutions & services. Value creation is achieved by rapidly integrating and applying technologies & practices to achieve superior operational and financial performance. • Business Model based on Multi-tiered funding & external leverage • Corp. funded Strategic Research (long term 3+ years) • Business-driven R&D (Tech Development) (shorter term 1-3 years) • On-demand technical services & support • Each Departmentoperates as a fully cost-recovered organization.

7. Energy Technology CompanyDepartments share common operating principles P&ET SSC RPO ILT DPS Cat HES TC • Focused on value • Partners define the interface • Organized by Competencies • All worked done in Projects • Solution, not a “parts department” • Leveraging capabilities across the enterprise • Leveraging sources of technology • Vendors, Universities, National Labs, New Venture Companies… • Connected to emerging technology

8. CVX Technology GovernanceFocus Areas and Networks • CVX technology management and deployment model focused on the rapid access of technology to achieve business results. • Focus Areas– Groupings characterized by common business challenges and technology requirements – groupings can include asset-types in some cases, technologies or business processes in other cases. (Governance for Strategic Research, Tech development, and strategic decisions on Services & Competencies). Role is to identify technology / value gaps and help line management in the allocation of program resources. • Technical Networks– A community of people responsible for and / or having expertise in similar technologies and areas of expertise.(Access to expertise world wide, sharing of BP/LL). Role is to facilitate employees to “seek, share and adopt”.

9. CVX Technology Focus Areas Exploration Upstream Growth Focus Areas Deep Water Development Gas Heavy Oil Reservoir Management Health, Environ. & Safety Well Systems Facilities & Operations Reliability Base Asset Focus Areas i-Field Transformational Focus Areas Transformational Technologies (IT, Molecular, Measurement, Adv. Energy & Emerging)

10. Next generation earth science technology Next generation reservoir management technology Deepwater drilling and production systems Real-time oilfield systems CO2 Sequestration Intelligent devices, systems, and networks Molecular transformation technologies Fuels of the future Advanced human-digital interaction Greenhouse gas management Research & DevelopmentKey Investment Areas

11. Upstream E&P Value Chain Earlier in Value Chain it is a Risk Business • Later in the value Chain it is more of a Margin Business

12. Energy Industry DriversManaging the base and capital business • The oil business has always been about managing the margins in both the upstream and downstream segments. • Operational excellence in operations is necessary. • World class management of capital projects is mandatory. • Exploration opportunities will be high risk (e.g. deepwater). • Global procurement is here to stay.

13. What becomes critical to the digital technology part of the energy business. • Technology application is critical to adding value. • Remote operations will be critical in deepwater. • Remote operations may be critical in shelf and land environments. • Big service companies providing all the innovation is not going to happen (margins are too small). • Improved resolution within the reservoir is critical because: • deepwater wells cost a lot, • fully exploiting existing assets is essential. • Integration opportunities become critical. • Innovation will come from the “fringes of technology”, improving equations, reducing approximations and refinement of measurement. • Workflow efforts will be critical to define business value.

14. How does innovation react? • Innovation (seismic) will focus on the details at the margin. • Workflow efforts could drive innovation to be more conservative than it already is, because it has to contribute immediately to the bottom line. • Compute technologies will reduce the need for approximations, Moore’s Law and other IT laws continue. • Large volumes of data will be handled by the computer with “smarts” from someone or some algorithm. • Inclusion of “financial” data into the workflow will be an everyday part of managing a prospect or oilfield. • Innovation will continue to come from people most familiar with both the business need and the technical problem. • Universities have and will become more deployment focused. • Less pure research, more business focused, and as always individual. • Joint ventures will be necessary but are unwieldy and less focused. • Small entities will develop niche products/innovations, fostering standards. These activities will drivestandards for data exchange.

15. What do standards mean? Least common denominator? No! Raising the bar? Yes! Defines what good looks like Loss of creativity? No! Actually can enhance creativity by supplying framework for innovation Allows inoperability – not tool based What can standards accomplish? Improve technical analysis Increased reliability and predictive accuracy for technical evaluations: Operational Excellence Improve organizational efficiency Standard workflows and processes to improve organizational efficiency: Organizational Capability Improve portfolio decision quality Improved ROCE through reduction in number of dry holes: Capital Stewardship Standards

16. Thank You 16