Long-term plans
On what happens about the contract expiry, Neff said Kazakhstan, “is a strategic partner for Chevron and our primary focus with Tengizchevroil is just safely and reliably producing this asset, getting this incredible project ramped up.”
“I’d imagine there’ll be discussions at the appropriate time around concession extension, but our focus has really been on making sure we complete this project safely and get it online, and operate it reliably.”
“With any concession extension you always want to make sure – and we do this all over the world – that it’s a win-win: there’s value we create in the country, there’s value for the Chevron shareholders as well. But that [discussion] will probably happen in due course. We’re a little ways away from that,” he said.
On the 1,500 km CPC export route, for which a US sanctions exemption is in place, Neff said the pipeline was “still a really important capacity of offtake,” echoing the view of Kazakh officials.
“It’s been operating very reliably -- we’ve debottlenecked the pipeline system. It’ll continue to be a main export route for Tengiz,” he said.
He outlined a string of projects – from Israel to the Gulf of Mexico -- intended to lift Chevron’s oil and gas output by 3% annually over the next five years, while stressing the major contribution from the 50% stake in the Kazakh joint venture, Tengizchevroil.
Highlighting the increased sour gas injection capacity, he dismissed the idea gas sales might be detrimental to oil production from Tengiz. In December, Tengizchevroil signed an agreement with a subsidiary of KazMunaiGaz to supply up to 9 Bcm/year of dry gas for a new polyethylene plant.
As well as increasing near-term oil output, the expansion “is going to enable us to extend the life of the field as well -- it also expands our sour gas injection,” Neff said. “We’re always trying to make sure that we’re maximizing the recovery from the reservoir.”
He declined to say whether there was scope for new investments and even higher output, but said, “We will -- I’m sure -- find other opportunities to debottleneck facilities, and there will be other sub-surface opportunities that will come about.”
“With any reservoir -- and this is a world-class, amazing reservoir -- you’re always collecting data and optimizing the reservoir, again to maximize the ultimate recovery, but do it at the optimum rate as well.”
Neff stressed Tengiz is a “milestone” among a number of projects designed to boost Chevron’s production, notably in the US, where it bought shale producer PDC Energy in 2023 and recently started up the Gulf of Mexico Anchor field.
Highlighting opportunities from Argentine shale to exploration off South America and West Africa, he said, “We’ve got a good portfolio. I think you’ll just see us continue to be capital-disciplined. We’ve got more opportunities than we’re going to spend in capital in every given year.”
