Please see Note 13, “Investments and Advances”, on page 71 for further information on the company’s investments in equity affiliates in Venezuela. At the end of 2019, the company manufactured, blended or conducted research at 10 locations around the world. Amortization - Capitalized exploratory drilling and development costs are depreciated on a unit-of-production (UOP) basis using proved developed reserves. Income taxes in Table III are based on statutory tax rates, reflecting allowable deductions and tax credits. Net daily oil-equivalent production in 2019 averaged 27,000 barrels, composed of 23,000 barrels of crude oil and 25 million cubic feet of natural gas. In 2017, sales of 177 BCF in the United States were primarily from the Midland and Delaware basins. This amount represents earnings reinvested as part of the company’s ongoing international business. Prices then started to decline due to heightened concerns about a slowing macro economy and weakening oil demand growth amid trade tensions between the. Net daily production in 2019 averaged 11,000 barrels of liquids and 89 million cubic feet of natural gas. The strength of the company’s balance sheet enabled it to fund any timing differences throughout the year between cash inflows and outflows. The amounts for consolidated companies are organized by geographic areas including the United States, Other Americas, Africa, Asia, Australia/Oceania and Europe. At December 31, 2019, the company had $9,750 in 364-day committed credit facilities with various major banks that enable the refinancing of short-term obligations on a long-term basis. In 2017, improved field performance at various Gulf of Mexico fields, including Jack/St Malo and Tahiti, and in the Midland and Delaware basins were primarily responsible for the 209 million barrel increase in the United States. The company seeks to minimize these operational risks by carefully designing and building its facilities and conducting its operations in a safe and reliable manner. Based on its high-quality debt ratings, the company believes that it has substantial borrowing capacity to meet unanticipated cash requirements. The information required by Item 407(e)(5) of Regulation S-K and contained under the heading “Corporate Governance — Management Compensation Committee Report” in the 2020 Proxy Statement is incorporated herein by reference into this Annual Report on Form 10-K. Pursuant to the rules and regulations of the SEC under the Exchange Act, the information under such caption incorporated by reference from the 2020 Proxy Statement shall not be deemed to be “soliciting material,” or to be “filed” with the Commission, or subject to Regulation 14A or 14C or the liabilities of Section 18 of the Exchange Act, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933. Includes non-cash additions of $1,201 and $184 right-of-use assets obtained in exchange for new and modified lease liabilities in 2019 for operating and finance leases, respectively. GSC reached a final investment decision in February 2019 to build an olefins mixed-feed cracker and polyethylene unit within the existing refining and aromatics facilities in Yeosu, South Korea. A total of 163 wells had been tied into production facilities by early 2020. For the 10 years ended December 31, 2019, actual asset returns averaged 8.1 percent for these plans. Form of Stock Appreciation Rights Agreement under the Long-Term Incentive Plan of Chevron Corporation. The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter — $236.2 billion (As of June 28, 2019), Number of Shares of Common Stock outstanding as of February 10, 2020 — 1,879,324,765, Notice of the 2020 Annual Meeting and 2020 Proxy Statement, to be filed pursuant to Rule 14a-6(b) under the Securities Exchange Act of 1934, in connection with the company’s 2020 Annual Meeting of Stockholders (in Part III). The majority of the company’s activity in derivative commodity instruments is intended to manage the financial risk posed by physical transactions. Most of the costs of complying with existing laws and regulations pertaining to company operations and products are embedded in the normal costs of doing business. The company has 2 guarantees to equity affiliates totaling $704. Proved reserves include both developed and undeveloped volumes. If either condition is not met or if the company obtains information that raises substantial doubt about the economic or operational viability of the project, the exploratory well would be assumed to be impaired, and its costs, net of any salvage value, would be charged to expense. Changes in the timing of production are included with “Revisions of previous quantity estimates.”, Item 15. The company will provide additional details relating to 2019 reserve additions in its Annual Report on Form 10-K scheduled for filing with the SEC on February 21, 2020. Chevron Corporation Deferred Compensation Plan for Management Employees II, filed as Exhibit 10.5 to Chevron Corporation’s Annual Report on Form 10-K for the year ended December 31, 2008, and incorporated herein by reference. Signed an agreement to sell the company’s interest in the Azeri-Chirag-Gunashli fields and Baku-Tbilisi-Ceyhan pipeline. Includes reserve quantities related to production-sharing contracts (PSC) (refer to page E-7 for the definition of a PSC). Chevron has a 70 percent-owned and operated interest in most of the Duvernay acreage. The amounts of these claims, individually and in the aggregate, may be significant and take lengthy periods to resolve, and may result in gains or losses in future periods. Completed the sale of interest in the Rosebank field. The $960 balance is related to 10 projects in areas requiring a major capital expenditure before production could begin and for which additional drilling efforts were not underway or firmly planned for the near future. Over the approximate 2-year remaining term of this guarantee, the maximum amount will be reduced as payments are made by the affiliate. The external factors that impact the duration of a project include scope and complexity, remoteness or adverse operating conditions, infrastructure constraints, and contractual limitations. The initial recognition of proved reserves occurred in 2019 for the multiphase subsea pump project. The company is unable to make reasonable estimates of the periods in which such liabilities may become payable. Upstream interests in Canada are concentrated in Alberta, British Columbia and the offshore Atlantic region. This supports commercial paper borrowing and can also be used for general corporate purposes. In addition, compensation expense for stock appreciation rights, restricted stock, performance shares and restricted stock units was $313 ($266 after tax), $60 ($47 after tax) and $231 ($150 after tax) for 2019, 2018 and 2017, respectively. Given the number of years that still remain subject to examination and the number of matters being examined in the various tax jurisdictions, the company is unable to estimate the range of possible adjustments to the balance of unrecognized tax benefits. Create an account, Please wait while we load the requested DEF 14A Annual Proxy Statement or click, Consolidated Statement Of Comprehensive Income, Consolidated Balance Sheet (Parenthetical), Consolidated Statement Of Equity (Parenthetical), Summary Of Significant Accounting Policies, Changes In Accumulated Other Comprehensive Losses, Information Relating To The Consolidated Statement Of Cash Flows. The company estimates that net oil-equivalent production in 2020 will grow up to 3 percent compared to 2019, assuming a Brent crude oil price of $60 per barrel and excluding the impact of anticipated 2020 asset sales. The permits for Nkossa, Nsoko and Moho-Bilondo expire in 2027, 2034 and 2030, respectively. The projects for the $960 referenced above had the following activities associated with assessing the reserves and the projects’ economic viability: (a) $256 (4 projects) – undergoing front-end engineering and design with final investment decision expected within four years; (b) $704 (6 projects) – development alternatives under review. Awards under the Chevron Long-Term Incentive Plan (LTIP) may take the form of, but are not limited to, stock options, restricted stock, restricted stock units, stock appreciation rights, performance shares and nonstock grants. As of February 10, 2020, stockholders of record numbered approximately 118,000. The occurrence of a significant incident or unforeseen liability for which the company is self-insured, not fully insured or for which insurance recovery is significantly delayed could have a material adverse effect on the company’s results of operations or financial condition. At December 31, 2019, the company’s carrying value of its investment in Petroboscan was approximately $90 higher than the amount of underlying equity in Petroboscan’s net assets. In 2017, extensions and discoveries in the Midland and Delaware basins and the Gulf of Mexico were primarily responsible for the 323 million barrel increase in the United States. Chevron holds a 50 percent-owned and operated interest in the Kitimat LNG and Pacific Trail Pipeline projects and a 50 percent-owned and operated interest in the Liard and Horn River shale gas basins in British Columbia. The company’s risk management practices and its compliance with policies are reviewed by the Audit Committee of the company’s Board of Directors. The company elected the option to apply the transition provisions at the adoption date instead of the earliest comparative period presented in the financial statements. An estimate as to the sensitivity to earnings for these periods if other assumptions had been used in recording these liabilities is not practicable because of the number of contingencies that must be assessed, the number of underlying assumptions and the wide range of reasonably possible outcomes, both in terms of the probability of loss and the estimates of such loss. Collective Trusts/Mutual Funds for U.S. plans are entirely index funds; for International plans, they are mostly unit trust and index funds. Changes in estimates or assumptions or the information underlying the assumptions, such as changes in the company’s business plans, general market conditions or changes in commodity prices, could affect reported amounts of assets, liabilities or expenses. Liabilities related to future remediation costs are recorded when environmental assessments or cleanups or both are probable and the costs can be reasonably estimated. Capital and exploratory expenditures by business segment for 2019, 2018 and 2017 are as follows: Total expenditures for 2019 were $21.0 billion, including $6.1 billion for the company’s share of equity-affiliate expenditures, which did not require cash outlays by the company. In November 2017, the National Court, First Instance, dismissed the complaint on jurisdictional grounds and. The total production capacity for the Wheatstone and Iago fields and nearby third-party fields is expected to be approximately 1.6 billion cubic feet of natural gas and 30,000 barrels of condensate per day. Additionally, with the exception of three years within this 10-year period, actual asset returns for these plans equaled or exceeded 6.75 percent during each year. Angola-Republic of Congo Joint Development Area. Long-Term Incentive Plan of Chevron Corporation, filed as Appendix B to Chevron Corporation’s Notice of the 2013 Annual Meeting and 2013 Proxy Statement filed April 11, 2013, and incorporated herein by reference. For awards granted under the company’s LTIP beginning in 2017, stock options and stock appreciation rights have graded vesting by which one third of each award vests annually on each January 31 on or after the first anniversary of the grant date. Six Months Ended June 30. To read page by page, use the arrows at the top. By making this election, the company has not applied retrospective reporting for the comparable periods. Effect of income taxes from international operations. “Cash and cash equivalents” do not include investments with a carrying/fair value of $1,225 and $1,139 at December 31, 2019, and December 31, 2018, respectively. Notes payable to banks and others with originating terms of one year or less, Current maturities of long-term finance leases, Unamortized discounts and debt issuance costs. Millions of dollars, except per-share amounts. Standard and Poor’s Corporation and Aa2 by Moody’s Investors Service. The company records asset retirement obligations when there is a legal obligation associated with the retirement of long-lived assets and the liability can be reasonably estimated. The sum of Chevron Corporation Stockholders’ Equity, total debt and noncontrolling interests, which represents the net investment in the business. In other countries, political conditions have existed that may threaten the safety of employees and the company’s continued presence in those countries, and internal unrest, acts of violence or strained relations between a government and the company or other governments may adversely affect the company’s operations. This legacy informs our approach to everything we do — from high ethical standards and a passion These vessels transport crude oil, LNG, refined products and feedstock in support of the company’s global upstream and downstream businesses. As an indication of the sensitivity of pension expense to the long-term rate of return assumption, a 1 percent increase in this assumption for the company’s primary U.S. pension plan, which accounted for about 59 percent of companywide pension expense, would have reduced total pension plan expense for 2019 by approximately $79 million. In contrast to price movements in the global market for crude oil, price changes for natural gas are more closely aligned with seasonal supply-and-demand and infrastructure conditions in local markets. The principal considerations for our determination that performing procedures relating to the impact of crude oil and natural gas reserves and other factors on upstream property, plant, and equipment, net is a critical audit matter are there was significant judgment by management, including the use of management’s specialists, when developing the estimates of proved crude oil and natural gas reserves and assessing upstream property, plant, and equipment to be held and used for impairment. Variables impacting Chevron’s estimated volumes of crude oil and natural gas reserves include field performance, available technology, commodity prices, and development and production costs. Management also makes judgments and estimates in recording liabilities for claims, litigation, tax matters and environmental remediation. Chevron has interests in Venezuelan crude oil production assets operated by independent equity affiliates. Other income increased in 2019 mainly due to the receipt of the Anadarko merger termination fee and higher gains from asset sales, partially offset by unfavorable swings in foreign currency effects. This uncertainty about the timing and/or method of settlement is factored into the measurement of the liability when sufficient information exists to reasonably estimate fair value. the impact of the estimates and assumptions on the company’s financial condition or operating performance is material. For the measurement of accumulated postretirement benefit obligation at December 31, 2019, for the main U.S. OPEB plan, the assumed health care cost-trend rates start with 6.8 percent in 2020 and gradually decline to 4.5 percent for 2025 and beyond. 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