Chevron to Spend $5.2 Billion on Output

Chevron Corp., the fourth-biggest oil refiner and retailer, said Tuesday that it plans to spend $5.2 billion this year, excluding acquisitions, to boost oil and natural-gas production and keep its refineries operating.

Separately, El Segundo-based oil and gas producer Unocal Corp. said it lowered four-year estimates of oil and natural-gas production by 24% because of delays in some projects. The company produces about 485,000 barrels a day of oil and gas, mostly from fields in Asia and the U.S.

Unocal said it expects to produce almost 700,000 barrels a day by 2004, down from earlier forecasts of 918,000. The company said it has decided to be more conservative in its estimates and will now include only production anticipated from established discoveries.

Gas production from a project in Bangladesh will start later than planned, and a delay in a pipeline in Azerbaijan will slow oil-production increases in that region, Unocal said.

San Francisco-based Chevron said it spent about $6.1 billion last year, including acquisitions. The company hasn’t disclosed what it paid for Petrolera Argentina San Jorge, a Buenos Aires-based oil explorer. Chevron also acquired Rutherford-Moran Oil Corp. for about $95 million in stock and $300 million in assumed debt.

Chevron plans to spend $3.6 billion, or 69% of the total, on trying to boost oil and gas output and reserves, with $1.3 billion earmarked for the U.S. The company will also boost spending in Kazakhstan, Angola, Nigeria, Thailand and Canada.

Chevron plans to spend about $830 million on its refineries and gasoline stations, including $530 million in the U.S.

Most of the rest will go to Caltex Petroleum Corp., its refining and fuel sales partnership with Texaco Inc., the No. 2 U.S. oil company, that operates in Asia, Africa and the Middle East.

Chevron plans to spend about $420 million on pipeline projects, mostly in Russia. It also plans to invest slightly more than $200 million in its chemicals business. The company had 1998 sales of about $26 billion.

In New York Stock Exchange trading, Chevron shares fell 81 cents to close at $87.06 and Unocal fell $1.19 to close at $32.50. Crude oil for February delivery rose 4.5% to $25.77 a barrel on the New York Mercantile Exchange, the biggest one-day gain since Oct. 12. Prices have risen 21% in the past three months.