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 Chief Executive Officer John Watson vowed Chevron will learn from
the stumbles, which include multiple electrical fires, pipeline
leaks, and even a worker's death after a rig collapsed last summer.
The company plans to have the LNG project up and running by next
year.
"Ultimately, we're accountable for it," Watson said in an interview
with Reuters. "There have been some lessons learned on that
(Angolan) project. But I don't point fingers. This is our
responsibility."
The frank comments, unusual for a major corporate leader, come as
Wall Street pressures major energy companies to maintain or boost
production to keep profits flowing - a goal made increasingly harder
by the rising costs of finding remote oil and natural gas reserves.
The Angolan trouble led Chevron to create an internal project
management system to better track contractors and subcontractors on
major projects, Watson said. Chevron is the largest stakeholder in
the Angolan project, with partners that include Total SA, BP Plc,
ENI SpA and Angola's Sonangol.
"We've learned from the experiences at Angola LNG and other
projects, working to make sure those same issues, or issues like
them, don't happen on the next generation of projects," he said.
Watson's comments on the Angola project should help assuage concern
the delay could cause the company to miss its 2014 production goals,
roughly 2.61 million barrels of oil equivalent per day.
"We're still on track to reach that," Watson said.
The Angolan mishaps will help Chevron as it moves forward on
engineering and design for its Kitimat LNG project in British
Columbia, Watson said, an indication Chevron is unlikely to pull the
plug even after Apache Corp quit.
Chevron is also nearing completion on two massive LNG projects off
the Australian coast to supply Asian markets.
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SHALE THREAT?
Even as Chevron works on LNG projects, the rise of the North
American shale industry has boosted global supplies of natural gas.
Chevron is a major natural gas producer in Pennsylvania's Marcellus
region.
Yet the company is struggling to lock-in sales contracts for its
Gorgon LNG plant in Australia, the world's most-expensive LNG
operation.
In Australia, seven LNG projects should be online by 2017, which,
taken with the North American shale renaissance, have raised
concerns about global oversupply.
Brushing aside any worry, Watson referenced Japan, which is fazing
out nuclear power, and China, with a rapidly rising middle class, as
major customers. Chevron has said global LNG demand will double from
2012 to 2025.
"We think the demand will be strong for LNG for many years to come,"
Watson added. "Many countries that don't have these resources will
continue to be major sources of demand."
(Reporting by Ernest Scheyder; Editing by Terry Wade and Andre
Grenon)
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