Tengizchevroil Overview

Tim Miller
General Director
Tengizchevroil

May 11, 2011

© Tengizchevroil 2011
 Tengizchevroil Background

Kazakhstan’s Leading Producer

 On 6 April, 1993, President Nazarbayev

signed Presidential Decree No 1168
approving the Tengiz Project Agreements

 TCO established as a Kazakhstan Limited

Liability Partnership between Kazakhstan
national oil company and Chevron on a
parity basis (40 year concession)

 1993 Oil Production – 2,500 TPD

 1Q11 Production – ~ 75,000 TPD

 ~30% of Kazakhstan’s total oil output

 3,200+ employees

 10,000+ contractors

 Present Shareholders – Chevron (50%),

ExxonMobil (25%), KazMunaiGas (20%),
LukArco (5%) -- 81% voting provision

© Tengizchevroil 2011 2
 TCO Strategic Intents

 Be the Leader in Safety and Environmental

Performance

 Develop Our Workforce

 Be Respected In Kazakhstan Community

 Achieve Superior Operational Performance

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 Tengizchevroil Operations

Reservoir Facilities Transport

 Reservoir liquids  Liquids processed  Crude and other

(mix of oil, gas, into crude oil, products
NGL’s, H2S, CO2, NGL’s, dry gas, transported via
etc.) produced and sulfur pipelines, rail, and
from wells and tankers to world
sent to the markets
facilities

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 Tengiz and Korolev Reservoirs

Tengiz
 Deepest developed super - giant
oil field
 Reservoir is 12 miles x 13 miles
 Oil column is 1 mile thick
 26 billion barrels oil in place

 13% hydrogen sulfide crude

Korolev
 2 billion barrels oil in place
 Production started in 2001
 15 % hydrogen sulfide crude

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 Tengiz Location

ATYRAU

NEW KARATON KULSARY

KOSCHAGYL

KAZAKHSTAN
RUSSIA

Tengiz

UZBEKISTAN

TURKMENISTAN

TENGIZ

CASPIAN SEA

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 Safety Performance
Industrial Days Away from Work

■ 11+ million hours without a TCO workforce DAFW

■ An all time record in overall workforce TRIR

1.60
Worldwide Oil & Gas Extraction Industry*
Incident Rate per 200,000 Manhours

1.40

1.20

1.00

0.80

0.60

0.40
Total Workforce = TCO + Contractors
0.20

0.00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

* Industry Data from the U.S. Dept. of Labor, Bureau of Labor Statistics

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 Motor Vehicle Safety Performance

 Continuous positive trend in the number of motor vehicle safety incidents

 Driving Monitors, Journey Management, Driver Training
 No serious and catastrophic accidents in 2010

Recordable MVCR
5 Year Trend

1.2
MVC Rate per MM miles

0.97
1.0
0.86
0.8
0.58
0.6
0.38
0.4

0.2 0.35
0
0.0
2005 2006 2007 2008 2009 2010

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 Environmental Performance
Air Emissions Reductions

9
From 2000 to 2010, TCO has achieved:
Total Emissions per Tonne of Oil

8  74% reduction in air emissions per tonne of oil

7  36% reduction in total emissions

 147% increase in oil production
6
(kg/tonne)

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

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 Environmental Performance
Gas Flaring Reduction

2001 - Post Gas

Processing Expansion
Project

2,000,000

1,800,000 2009 - After Vent

Gas Recovery Project
Gas Flared (tonnes)

1,600,000

1,400,000

1,200,000

1,000,000

800,000

600,000

400,000

200,000

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

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 Superior Operational Performance
■ 15% year-on-year production growth in
2010 (25.9 million tonnes) vs. 2009
(22.5 million tonnes)
■ World-class equipment reliability and
production efficiency

Crude Production
Million tonnes per year

26
24
22
Train 5 Program 12 SGI-SGP Start-up
20
$1 billion $7.4 billion
18
16 KTL 1 & 2
Debottlenecking
14
$150 million
12
10 KTL 2 Start-up
8 $187 million
6 KTL 1
4 Operation
2
0
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Mar
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 Total Payments to the Republic of Kazakhstan

■ 2010 Total Payments Exceeded $9.6 billion

■ Cumulative Payments to Kazakhstan Exceed $48.3 billion

14,000 60,000
Annual Payments to Kazakhstan - $MM

Cumulative Payments to Kazakhstan - $MM

13,000 Payments to Employees and Kazakh Goods &
Services (includes salaries, Rail and Pipeline Tariffs,
55,000
12,000 payments to local suppliers and other) 50,000
11,000 Distribution to Kazakhstan
45,000
10,000
40,000
9,000
Taxes and Royalties
8,000 35,000
7,000 30,000
Cumulative Payments through March 2011
6,000 25,000
5,000
20,000
4,000
15,000
3,000
10,000
2,000
1,000 5,000
0 0

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 Kazakhstani Goods and Services
Accomplishments: Current Focus:
■ $1.35 billion in 2010 ■ Kazakhstani Content Team
■ $9.97 billion cumulative spend since 1995 ■ FGP Kazakhstani Content
■ Contracting Strategy
■ Manufacturing Capability
Kazakhstani Goods and Services (KG&S)
Millions of Dollars per year
1,600

1,400

1,200

1,000

800

600

400

200

0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Mar

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 Sulfur Production, Sales & Inventory

■ Inventory reduced by 1.25 million tonnes in 2010

■ Currently under 5.2 million tonnes of sulfur in inventory

4.0
4,000 10
10,000
9.2
3.6
3,600 Pad Inventory
3.6 9
3.2 9,000
Million Tonnes per Year

3,200

Pad Inventory (MT)

2.8 3.2
2,800 8
8,000
2.4
2,400
2.0 7
2,000 2.2 7,000
Production 2.1
1.6
1,600
1.2 1.6 6
6,000
1,200 1.3 5.5
0.8
800 0.9 5
5,000
0.4
400
0.0
0.4
0 4
4,000
2003 2004 2005 2006 2007 2008 2009 2010
Million Tonnes per Year

Total Sales Production Pad Inventory

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 Corporate Social Responsibility

Egilik Program
■ Social infrastructure program
■ $165 million invested
■ Recipient of 2008 Silver Paryz
Award for Best Social Project
■ Recent projects:
● Vocational school in Kulsary
● Renovation of entire water
system in Kulsary
● Continued gasification, Egilik Spending
electrification and water system 25

upgrades in Atyrau 20
■ Historical projects: $ Millions

● Kulsary hospital 15

● Turgyzba & Akkistogai clinics

10
● 2 schools in Atyrau micro-regions
● Atyrau University Annex 5
● Oil and Gas University repairs
● Kulsary road repairs 0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
● Hospital and school equipment Actual

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 Workforce Development

100%

90% 85%

TCO Employees
80%
% Kazakhstani

68% 76%
70%

60%
60% TCO Supervisor and Managers

50%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20102011 Mar

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