THE lifeblood of a company like Chevron is, of course, the resource it exploits and, in this case, this US super-major has a pipeline of billion-dollar-class project investments worldwide, especially offshore West Africa, in the US Gulf and Asia-Pacific.
Europe is in the portfolio, too, but is not yielding sufficient new finds to justify the same level of attention.
This means having a robust exploration programme in order to fill the tank, so to speak.
“We’ve added over a billion barrels a year from our exploration into this thing that I call our resource base,” said Robertson.
“We advertise to the public (and research analysts) that our resource base is in the order of 62billion barrels worldwide. Our proved reserves are about 11billion.
“But it’s keeping on feeding into that resource base that creates the wherewithal to do development. So we have that 62billion barrel resource base that we’d like to develop.
“Each year, we produce about a billion barrels, so we put in a bit more than a billion from exploration and our resource has gone up by 12% in the last three or four years.”
There is an irony in this as Chevron wasn’t always a world-class explorer, as Robertson frankly admitted.
“Before we merged with Texaco there was probably a debate as to who was the worst explorer in the industry, Chevron or Texaco. We thought Texaco was the worst, and vice versa.
“In the 1990s, both had a dismal exploration record. Both had good technology but, for whatever reason, they weren’t very successful.
“After the merger, we changed out exploration philosophy to a more centralised approach. We looked at the world and asked where the best prospects were located, as opposed to each business unit spending effectively its own exploration budget.
“Something as simple as that had an impact. Centralised expertise could devote itself to evaluating and preparing prospects and using a standard approach for comparing opportunities. I think it has been pretty well accepted that … and I think you could go to Wood McKenzie in Edinburgh and get this answer … if Chevron doesn’t have the best exploration success since 2002, it is very close to the best.
“We’ve discovered more than 1billion barrels of resources a year … not proven reserves … and we’ve done this every year since 2002, and 2008 was no exception. “We’ve had a very strong exploration run. That success has been primarily in deepwater Gulf of Mexico, West Africa and Australia, not forgetting Thailand.
“The Unocal acquisition made us the big fish there. In the case of Australia, we have made mega-discoveries over many years, none of which have yet been developed as they’re natural gas. But we’re the largest oil&gas resource holder of all the companies in Asia-Pacific, leaving out national companies. With 40-50trillion cu ft or more of gas in Western Australia alone, we have enormous discoveries to be developed.”
Robertson described these as Chevron’s “focus areas”, places where the company has made sufficient discoveries to warrant heavy investment to secure the prize.
He added that there were a number of test areas, one of which is basically the North Atlantic Basin, including West of Shetland – places where a big play hasn’t been fully established.
And so we return to the great UK Continental Shelf hope, Rosebank/Lochnagar.
Robertson: “You’re talking about a potentially multibillion-dollar development in a remote location, but in order to justify spending such sums you need to have more than just a discovery.
“Rosebank/Lochnagar is an unusual discovery geologically. It’s in the basalt, it’s hard to see seismically and so it’s hard to characterise. And so our feeling is that we need another one, or maybe two, wells to feel sufficiently confident that the reservoir is big enough to justify this multi-billion investment.
“That doesn’t happen overnight.