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REPUBLIC OF KAZAKHSTAN AND CHEVRON CORPORATION ANNOUNCE FORMATION OF THEIR JOINT VENTURE

 ALMATY, Kazakhstan, April 6 /PRNewswire/ -- The Republic of Kazakhstan and Chevron Corporation (NYSE: CHV) today announced the formation of their joint venture company, Tengizchevroil (TCO), to develop the Tengiz and Korolev oil fields on the northeastern Caspian Sea coast.
 In a ceremony in Almaty, Republic of Kazakhstan President Nursultan Nazarbaev and Chevron Corporation Chairman and CEO Kenneth T. Derr signed the memorandum to create the 40-year joint venture project. The joint venture is the largest such arrangement between the Republic of Kazakhstan and a major multinational oil company.
 The negotiating teams led by Minister of Energy and Fuel Resources, Kadyr K. Baikenov and Chevron Overseas President, Richard H. Matzke concluded a multiyear negotiation with the signing on April 2 of the Joint Venture Formation Agreement and other relevant documents.
 Tengizchevroil is owned 50/50 by Tengizneftegaz, a subsidiary of Kazakhstanmunaigaz, the national oil company, currently operating the field and by Chevron Overseas Company, a unit of Chevron's international exploration and production subsidiary. The joint venture has been formed as an export project to generate hard currency revenues in international oil markets.
 "Kazakhstan is rich in natural resources, and Chevron brings modern technology, management techniques and financial investment capabilities to complement the partnership," Chevron's Derr said.
 Financial arrangements for the joint venture have been structured to provide benefits to both Kazakhstan and Chevron. To acquire its 50 percent interest in the joint venture, Chevron will pay the government of Kazakhstan bonuses as well as provide funds for development obligations and progress payments.
 TCO will contribute $50 million over five years to the Atyrau Oblast, the region encompassing the joint venture, to develop mutually agreed upon projects to benefit the local communities, such as improvements to the drinking water supply and to medical facilities.
 In addition to Tengizneftegaz receiving 50 percent of the joint venture earnings, the Republic of Kazakhstan will also receive substantial revenues from taxes and royalties. Royalty arrangements will provide for an increase in government income as TCO becomes more profitable. Distribution of income over the life of the joint venture is expected to be about 80 percent for Kazakhstan and 20 percent for Chevron.
 TCO, the operator, will have approximately 3,600 employees initially, more than 90 percent of whom will be from Kazakhstan. Management of TCO will be shared by Chevron and Tengizneftegaz, with Chevron providing key operating, technical and financial management personnel. TCO will be headquartered in Tengiz, near the oil fields, but will have offices in Atyrau, the regional center, and in Almaty, the national capital. Chevron's Morley J. Dupre and Atyrau Oblast's Ravil Cherdabaev have been appointed general director and director of TCO respectively.
 Original oil in place in the Tengiz field is estimated to be about 25 billion barrels, with six billion to nine billion barrels recoverable. Tengizchevroil expects potential peak oil production of more than 700,000 barrels per day by 2010. The Tengiz field was put on production in 1991 and currently has a production capacity of about 65,000 barrels per day.
 Tengiz crude oil is high quality (47 API gravity) and produces a high percentage of valuable light end products like gasoline and kerosene when refined. Most of the associated products, such as natural gas, liquified petroleum gas and sulfur, will initially be consumed within Kazakhstan to satisfy urgent local demand.
 The joint venture expects to invest more than $1.5 billion in development of the field over the next three to five years and plans to phase the investment program consistent with progress on facilities to ensure the continuous export of the full production capacity of the field and construction of an export pipeline. This phased approach is anticipated to provide optimum development of the field to meet the needs of both partners.
 Design and operation of the field in an environmentally safe manner is of utmost importance to the joint venture.
 TCO's initial activities will focus on preliminary engineering and other work to ensure the continuous safety and reliability of existing operations, further preparation for the completion and startup of the KTL-2 gas processing plant, and various arrangements to ensure that accommodations, transportation, communications and other related needs are in place to support all joint venture personnel.
 The ultimate development of the Tengiz and Korolev fields will require the construction of a new pipeline to transport the expected production to an export facility. Until a new pipeline is completed, Kazakhstan, Russia and Chevron have agreed that the transportation and exchange of Tengiz crude will be arranged so that it can be exported to world markets and sold for hard currency.
 -0- 4/6/93
 /CONTACT: Larry Shushan, 415-894-2978, or Sherri Zippay, 415-894-4581. both of Chevron/
 (CHV)


CO: Chevron Corp.; Tengizchevroil; Chevron Overseas Co. ST: California IN: OIL CHM SU: JVN

GT -- SF003 -- 3388 04/06/93 11:01 EDT
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Date:Apr 6, 1993
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