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    ChevronTexaco Executives Report to Security Analysts

    Asset sale proceeds expected to exceed $3 billion this year.

    NEW YORK -- ChevronTexaco is delivering on its pledge to achieve industry-leading financial returns, said chairman and CEO David J. O'Reilly in a presentation to security analysts on Tuesday.

    O'Reilly reported that from the beginning of 2000 to the present, the company is No. 1 among its largest peers in total stockholder return, and that the company is poised to provide strong earnings and returns in the future.

    The company has dramatically strengthened its balance sheet in the last two years, according to O'Reilly. "We're currently in the fortunate position where we have a strong balance sheet, as well as the ability to fund our queue of good, economic projects and increase the amount of cash returned directly to our stockholders," he said.

    O'Reilly said the company has followed through on its objective to high-grade its portfolio and generate value, with asset sale proceeds expected to exceed $3 billion this year. He added that the company's portfolio is well positioned to leverage strong market conditions and that current industry conditions only serve to reinforce that the company is pursuing the right strategies at the right time.

    ChevronTexaco's capital and exploratory expenditure program for 2005 totals $10 billion, O'Reilly said, adding that next year's spending represents an increase over the last two years because the company is going into higher spending stages at several key growth projects.

    Vice chairman Peter Robertson told analysts that the company is delivering on its key upstream strategies. "With 2003 as the base, our objective is to grow production volumes an average of at least 3 percent compounded over the next 5 years," Robertson said.

    Robertson indicated the objective could be achieved with a planned strong growth in production capacity during the 2006 through 2008 period. "We are making good progress on our major capital projects. These new projects are expected to bring our production to approximately three million barrels per day in 2008," he added.

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