Dr. Donald L. PaulDr. Donald L. PaulCorporate Vice President Corporate Vice President Technology and Environmental AffairsTechnology and Environmental AffairsChevronChevron

American Geological Institute • Academic-Corporate Associates Conference • February, 1999American Geological Institute • Academic-Corporate Associates Conference • February, 1999

challenges andchallenges and

opportunitiesopportunities

turbulenceturbulence

State of the State of the GeosciencesGeosciences

2

1 9 9 71 9 9 7constant $ / constant $ / bblbbl

00

1010

2020

3030

4040

5050

6060

7070

8080

19001900 19101910 19201920 19301930 19401940 19501950 19601960 19901990 2000200019701970 19801980

W T I B E N C H M A R KW T I B E N C H M A R K

$15 $15

Commodity crude oil prices Commodity crude oil prices and continued volatilityand continued volatility

1982 to 1992:1982 to 1992:U.S. upstreamU.S. upstreamemployment employment declines >50%declines >50%

1972 to 1982:1972 to 1982:U.S. upstreamU.S. upstream

employment employment triplestriples

3

Large Integrated Oils

Super Large Integrated Oils

Smaller Integrated Oils &

Independents

0% 10% 15% 20% 25% 30%5% TSR

1989-1998 1989-1998 S&P 20.0%S&P 20.0%

1989-1998 1989-1998 S&P 20.0%S&P 20.0%1989-19981989-1998

1994-19981994-1998

Annualized Total Shareholder Return (TSR)

1994-1994-1998 S&P 1998 S&P 24.7%24.7%

1994-1994-1998 S&P 1998 S&P 24.7%24.7%

The competition for investors The competition for investors increasesincreases

4

Chevron EmployeeChevron EmployeePopulationPopulation

Age GroupAge Group

<25<25 25-3025-30 31-4031-40 41-5041-50 51-6051-60 >60>6000

10001000

20002000

30003000

40004000

50005000

60006000

199719972007 with hiring2007 with hiring2007 no hiring2007 no hiring

199719972007 with hiring2007 with hiring2007 no hiring2007 no hiring

00

1010

2020

%%

18-2418-24 40-4440-44 60-6460-64

SEG SEG

Managing the demographic Managing the demographic wave wave is a major industry challengeis a major industry challenge

5

Factors driving geoscience Factors driving geoscience employmentemployment• Globalization of resources, markets, & Globalization of resources, markets, &

technology (mega-trend)technology (mega-trend)

• Energy industry demographics remain very Energy industry demographics remain very favorable (demand will not return to historical favorable (demand will not return to historical highs ashighs as bbl / employee continues to rise)bbl / employee continues to rise)

• Environmental geoscience demands should hold Environmental geoscience demands should hold employment steady in the service sectoremployment steady in the service sector

• Basic earth science research (universities & Basic earth science research (universities & government organizations) should remain about government organizations) should remain about level (climate systems increasing)level (climate systems increasing)

• Inclusion of more earth science in academic Inclusion of more earth science in academic programs could increase teaching demandprograms could increase teaching demand

6

Typical traditional career options Typical traditional career options for geoscientists in the energy for geoscientists in the energy industryindustry• Exploration GeologistExploration Geologist

• Research GeophysicistResearch Geophysicist

• Seismic ProcessorSeismic Processor

• Log AnalystLog Analyst

• Chief GeologistChief Geologist

• Exploration ManagerExploration Manager

• VP ExplorationVP Exploration

Functionally Directed& Discipline-OrientedFunctionally Directed& Discipline-Oriented

7

New career options for New career options for geoscientists in the energy geoscientists in the energy industryindustry• Asset Team Member Asset Team Member

• Consulting SpecialistConsulting Specialist

• Technology Marketer Technology Marketer

• Project ManagerProject Manager

• Business Unit Manager Business Unit Manager

• Technology Product DeveloperTechnology Product Developer

• Technology System Integrator Technology System Integrator

• Operating Company PresidentOperating Company President

Business Directed& Multi-disciplinaryBusiness Directed& Multi-disciplinary

8

Why should geoscientists Why should geoscientists pursue a career in the energy pursue a career in the energy industry?industry?

• Exciting work & exotic locationsExciting work & exotic locations

• Truly global business Truly global business

• Technologically advanced workTechnologically advanced work

• Highly educated workforceHighly educated workforce

• Empowered team environmentsEmpowered team environments

• Top-level industrial Top-level industrial compensationcompensation

• Transportable skillsTransportable skills

• Very favorable demographicsVery favorable demographics

9

The best opportunities in a The best opportunities in a generation are available for generation are available for individuals who:individuals who:• Possess superior content expertise combined Possess superior content expertise combined

with high-level information technology skills with high-level information technology skills

• Understand the connection of business Understand the connection of business success to science & technologysuccess to science & technology

• Have the ability to translate their knowledge Have the ability to translate their knowledge & experience into new opportunities & lines & experience into new opportunities & lines of workof work

• Are highly adaptable & flexibleAre highly adaptable & flexible

• Develop relationship & teamwork skillsDevelop relationship & teamwork skills

• Have a global mindset & language skillsHave a global mindset & language skills