Chevron Corporation · NYSE:CVX
Chevron — Investor Day (February 2023)
47 slides from Chevron's investor day presentation, Feb 28, 2023
Slide 1: February 28, 2023
February 28, 2023 © 2023 Chevron. All rights reserved.
Slide 2: Agenda
Agenda Presentation and Q&A 8:30 AM – 11:30 AM ET Introduction Roderick Green – General Manager, Investor Relations Higher returns Mike Wirth – Chairman of the Board and Chief Executive Officer 8:30 – 9:30 AM + Q&A Nigel Hearne – Executive Vice President, Oil, Products & Gas 9:30 – 9:40 AM Break Low
Slide 3: Cautionary statement
Cautionary statement CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This presentation contains forward-looking statements relating to Chevron’s operations and energy transition plans th
Slide 4: Higher returns
Chevron Investor Day Higher returns February 28, 2023 Mike Wirth Nigel Hearne Chairman of the Board and Executive Vice President, Chief Executive Officer Oil, Products & Gas © 2023 Chevron. All rights reserved.
Slide 5: Balanced energy framework
Balanced energy framework Economic prosperity Energy security Environmental protection Affordable for Reliable and Ever-cleaner customers and countries diverse supply energy © 2023 Chevron 5
Slide 6: Safely deliver higher returns, lower carbon
Safely deliver higher returns, lower carbon Higher returns Lower carbon Advantaged portfolio Progress toward 2028 carbon intensity targets Capital and cost discipline Aim to be a leader in methane management Growing traditional energy Growing renewable fuels Superior distributions to shareholders Ea
Slide 7: Capital discipline
Capital discipline Capex* Affiliate capex $ billions $ billions Capex outlook $13 - $15B per year $13 - $15 $3.4 $14 $3 $10.7 Affiliate capex outlook ~$2 ~$2B per year * Includes organic spend only. See Appendix for reconciliation of non-GAAP measures and slide notes providing definitions, source in
Slide 8: Profitably growing our upstream business
Profitably growing our upstream business Upstream earnings per barrel Production guidance Excludes special items Excludes impact of potential asset sales Net MMBOED Improved margins Capital & cost efficient Expect >3% CAGR for production by 2027 2023-2027 guidance is based on flat nominal $60/BBL Br
Slide 9: Delivering value in the Permian
Delivering value in the Permian Midland & Delaware Basin Free cash flow2 & ROCE Net MBOED Returns focused Technology driving efficiency Lower carbon expect ~40% renewable power1 See Appendix for reconciliation of non-GAAP measures and slide notes providing definitions, source 1 Behind the meter and
Slide 10: Focused on delivering FGP / WPMP
Focused on delivering FGP / WPMP Project update Looking ahead Bulk construction complete WPMP maintains base production Executing WPMP start-up activities FGP adds ~260 MBD TCO production profile (100%) MBOED See Appendix for reconciliation of non-GAAP measures and slide notes providing definitions,
Slide 11: Continuing deepwater excellence
Continuing deepwater excellence Gulf of Mexico West Africa Australia Eastern Med Expect 300 MBOED Supporting Record 99% by 2026 base business 2022 cargoes reliability Anchor, Whale, Nigeria Advancing Tamar Ballymore, Mad Dog 2 lease renewals backfill projects expansion © 2023 Chevron 11
Slide 12: Connecting our natural gas resources to demand
Connecting our natural gas resources to demand Large gas resource >175 net TCF >65 TCF >10 TCF Optimizing From USGC portfolio >20 TCF Accessing >45 TCF demand Key equity natural gas resources Current LNG Future LNG All resource figures are net unrisked resource as of December 31, 2022. See Appendix
Slide 13: Competitive chemical and downstream projects
Competitive chemical and downstream projects CPChem projects Refining evolution Geismar expansion Advantaged ethane feedstock Pasadena LTO integration Adds ~15 MBD of RD capacity 2 MMTPA crackers (USGC, Qatar) Renewable hydroprocessing Expected start-up in 2024 See Appendix for reconciliation of non
Slide 14: Higher returns supplemental slides
Higher returns supplemental slides © 2023 Chevron 14
Slide 15: 10-year reserves and resource
10-year reserves and resource Reserves Resource 10-year reserve replacement 10-year resource replenishment BBOE Total 6P BBOE 10-year -10.3 36.9 11.3 -10.3 11.3 11.2 99% RRR 64.7 -13.4 77.9 -1.1 YE 2012 Production Asset Net YE 2022 YE 2012 Production Asset Net YE 2022 sales adds Net adds sales adds
Slide 16: Returns focused production growth
Returns focused production growth Managing base decline Production guidance for key assets Excludes impact of potential asset sales Excludes impact of potential asset sales Net MMBOED Net MBOED Facility-constrained +450 MBOED base production Disciplined investment +130 +200 MBOED MBOED +100 MBOED Mu
Slide 17: Permian COOP well performance
Permian COOP well performance 2022 POPs Midland Basin Delaware Basin Cumulative production vs. forecast Cumulative production vs. forecast Midland Basin 2023+ expected New Mexico program above forecast 2022 New Mexico wells unaffected by long-sitting DUCs 2022 forecast Delaware Basin below forecast
Slide 18: Gulf of Mexico projects
Gulf of Mexico projects Major capital projects Liquids Gas Ownership capacity capacity Project Operator percentage (MBD, 100%) (MMCFD, 100%) Start-up1 Mad Dog 2 Other 15.6 140 75 2023 Anchor Chevron 75.4 / 62.92 75 28 2024 St. Malo Stage 4 Maintain Maintain Chevron 51 2024 Waterflood capacity capaci
Slide 19: Other Shale & Tight development plans
Other Shale & Tight development plans Argentina Started El Trapial development Haynesville Rig counts and well POPs 1st rig began drilling January 2023 COOP & NOJV 2021 2023 2025 Rig count 4 8 11 DJ Basin Expect to POP ~2x wells in 2023 vs. 2022 Well POPs 150 200 250 Kaybob Duvernay Expect to mainta
Slide 20: Lower carbon
Chevron Investor Day Lower carbon February 28, 2023 Jeff Gustavson Eimear Bonner President, Vice President, Chevron New Energies Chief Technology Officer © 2023 Chevron. All rights reserved.
Slide 21: Advancing our lower carbon future
Advancing our lower carbon future Lower carbon intensity Grow new energies 2030 targets Upstream CO2 intensity 35% by 2028 Renewable fuels 100 MBD reduction target1 Net Zero2 Upstream By 2050 CCUS & offsets 25 MMTPA Scope 1 & 2 aspiration PCI1 reduction target3 >5% by 2028 Hydrogen5 150 KTPA Scope 1
Slide 22: Carbon efficient supplier of energy
Carbon efficient supplier of energy Lowering upstream carbon intensity Keeping methane in the pipe Chevron’s oil and gas production carbon intensity 13 advanced detection technologies trialed since 2016 Oil Gas 2028 targets >950 methane detection flyovers 1 completed in 2022 >37 million component in
Slide 23: Integrating renewables into our business
Integrating renewables into our business RD / BD RNG / CNG Added feedstocks with Bunge & CoverCressTM Expanded production with CalBio & Brightmark Expect 5x more USWC stations selling RD / BD by year-end >75 CNG sites online or in progress Renewable fuels production capacity Renewable natural gas pr
Slide 24: Growing our CCUS business
Growing our CCUS business Over 65 active CCUS opportunities Secure pore space Create regional hubs Advance capture technology Focus area © 2023 Chevron 24
Slide 25: Developing CCUS value chains
Developing CCUS value chains U.S. Gulf Coast Asia Pacific Technology >1 billion tons CO2 storage resource1 3 permits to assess CO2 storage2 Investments in Svante & Carbon Clean Early mover ~140,000 acres1 Advancing regional emissions hub Studying CO2 shipping with MOL Texas Beaumont Port Arthur Hous
Slide 26: Growing our hydrogen business
Growing our hydrogen business Over 50 active H2 opportunities Advance production hubs Leverage natural gas value chains From U.S. Enable technology Support expected future demand Opportunities Early mover (demand) Potential trade flows See Appendix for reconciliation of non-GAAP measures and slide n
Slide 27: Developing hydrogen value chains
Developing hydrogen value chains United States Asia Pacific Technology Advancing Gulf Coast hubs with CCUS Exploring low CI fuels Australia to Japan H2 transport and storage projects Establishing West Coast value chains Studying H2 & NH3 from geothermal Investments in Raven & Aurora West Coast Gulf
Slide 28: Technology powering today’s businesses
Technology powering today’s businesses Safety Higher returns Lower carbon Scalable robotic tank inspection Optimizing field development Preventing & detecting emissions Eliminates worker risk & reduces costs Reduces cycle time & unlocks resources Real-time identification & mitigation See Appendix fo
Slide 29: Technology building tomorrow’s businesses
Technology building tomorrow’s businesses Asset class excellence Renewable fuels Enhance Convert reservoir challenged recoveries feedstocks Facilities of the future CCUS & H2 Automate Reduce facilities and costs across the operations value chain © 2023 Chevron 29
Slide 30: Winning combination
Chevron Investor Day Winning combination February 28, 2023 Pierre Breber Mark Nelson Vice President and Vice Chairman and EVP, Chief Financial Officer Strategy, Policy & Development © 2023 Chevron. All rights reserved.
Slide 31: Delivering higher returns
Delivering higher returns ROCE improvement Free cash flow 2017-2022 at $60 Brent, $ billions Peer leading ROCE improvement 2 Target >12% ROCE by 2027 2 Expect >10% FCF average annual growth 3 CVX Peers1 1 Peers include BP, SHEL, TTE, and XOM. 2 ROCE and FCF at $60 Brent. 3 2022 FCF is normalized to
Slide 32: Upside leverage and downside resilience
Upside leverage and downside resilience Downside potential* Upside potential* $ billions, 2023-2027 $ billions, 2023-2027 Raise annual buyback Other guidance to Cash on B/S $10 - $20 billion Other Buyback Cash on B/S capacity Buyback Debt capacity Cash from ops Capex Capex Cash from ops ~3% to ~6% o
Slide 33: Financial priorities unchanged
Financial priorities unchanged Dividend growth per share Net debt ratio2 CAGR, 2017-2022 2018-2022 Maintain and grow dividend Fund capital program Strong balance sheet Return surplus cash CVX Peers1 CVX Peers1 1 Peers include BP, SHEL, TTE, and XOM. 2 Net debt ratio is defined as debt less cash, cas
Slide 34: Consistent, prepared, adaptive
Consistent, prepared, adaptive Pragmatic approach Higher returns Lower carbon Advantaged portfolio Efficient execution Reduce carbon intensity Leverage strengths Maintain capital discipline Grow New Energies © 2023 Chevron 34
Slide 35: Consistency drives value
Consistency drives value Disciplined execution Performance delivery Leading capital efficiency More cash returned per share Continued cost and capital discipline Strong balance sheet Capital efficiency Total cash returned to investors Capex / CFFO, 2018-2022 per share CVX Peers* CVX Peers* * Peers i
Slide 36: Winning combination
Winning combination Disciplined growth Lower carbon Higher cash Progress toward Affirmed production growth of Upstream CO2 intensity Raised annual buyback >3% CAGR by 2027 reduction target2 guidance to $10 - $20 billion Maintain $13 - $15 billion in 1 On track for 2030 renewable Expect >10% FCF cape
Slide 37: Reconciliation of non-GAAP measures appendix
Reconciliation of non-GAAP measures appendix © 2023 Chevron 37
Slide 38: Appendix: reconciliation of non-GAAP measures
Appendix: reconciliation of non-GAAP measures Upstream earnings per barrel excluding special items TOTAL UPSTREAM TOTAL UPSTREAM 2015 2016 2017 2018 2019 2015 - 2019 Earnings ($MM) $(1,961) $(2,537) $8,150 $13,316 $2,576 Earnings ($MM) $19,544 Adjustment items: Adjustment items: Asset dispositions 3
Slide 39: Appendix: reconciliation of non-GAAP measures
Appendix: reconciliation of non-GAAP measures Free cash flow $MM FY 2022 Net cash provided by operating activities 49,602 Net decrease (Increase) in operating working capital 2,125 Cash Flow from Operations Excluding Working Capital 47,477 Net cash provided by operating activities 49,602 Less: capit
Slide 40: Appendix: reconciliation of non-GAAP measures
Appendix: reconciliation of non-GAAP measures Net debt ratio $MM 2018 2019 2020 2021 2022 Short term debt 5,726 3,282 1,548 256 1,964 Long term debt* 28,733 23,691 42,767 31,113 21,375 Total Debt 34,459 26,973 44,315 31,369 23,339 Less: Cash and cash equivalents 9,342 5,686 5,596 5,640 17,678 Less:
Slide 41: Higher returns appendix
Higher returns appendix © 2023 Chevron 41
Slide 42: Appendix: slide notes
Appendix: slide notes This presentation is meant to be read in conjunction with the 2023 Chevron Investor Day Transcript posted on chevron.com under the headings “Investors,” “Events & Presentations.” Slide 6 – Safely deliver higher returns, lower carbon Slide 9 – Delivering value in the Permian • P
Slide 43: Appendix: slide notes
Appendix: slide notes This presentation is meant to be read in conjunction with the 2023 Chevron Investor Day Transcript posted on chevron.com under the headings “Investors,” “Events & Presentations.” Slide 15 – 10-year reserves & resource • BBOE – Billion barrels of oil equivalent • RRR – Reserve r
Slide 44: Lower carbon appendix
Lower carbon appendix © 2023 Chevron 44
Slide 45: Appendix: slide notes
Appendix: slide notes This presentation is meant to be read in conjunction with the 2023 Chevron Investor Day Transcript posted on chevron.com under the headings “Investors,” “Events & Presentations.” Slide 21 – Advancing our lower carbon future Slide 25 – Developing CCUS value chains • For addition
Slide 46: Winning combination appendix
Winning combination appendix © 2023 Chevron 46
Slide 47: Appendix: slide notes
Appendix: slide notes This presentation is meant to be read in conjunction with the 2023 Chevron Investor Day Transcript posted on chevron.com under the headings “Investors,” “Events & Presentations.” Slide 31 – Delivering higher returns Slide 33 - Financial priorities unchanged • ROCE improvement –