HOUSTON -(Dow Jones)- Chevron Corp. (CVX) Chief Executive John Watson saidWednesday the oil and gas industry has asked the U.S. government to raise thesafety standards for offshore drilling in order to avoid another “tragedy” likethe massive spill that is still threatening the U.S. Gulf of Mexico.
Speaking at the company’s shareholder meeting in Houston, Watson said thecompany leads one of the two industry task forces that last week gave U.S.Interior Secretary Ken Salazar a report with recommendations about theprocedures that should be implemented and improved to avoid another massiveaccident.
“The energy industry is learning a great deal,” Watson said. “If there issomething we need to adopt, we will adopt it.”
The head of Chevron, the second largest U.S. oil company by market value afterExxon Mobil Corp. (XOM), said the company reviewed its own safety standards andoperational procedures after the spill, which followed the explosion and sinkingin April of Transocean Ltd.’s (RIG) Deepwater Horizon rig. The blast aboard therig, leased by BP PLC (BP), killed 11 workers.
Chevron, which is one of the biggest oil and gas producers in the Gulf ofMexico, has a team of experts currently working with BP to try to stop thespill, Watson said. He added that more studies on the cause on the spill will becertainly done by the industry, which will raise offshore drilling standards andalso point to how to improve clean up operations.
BP said Wednesday it is still conducting tests to determine whether it canplug the oil spill using heavy drilling fluids, even as it continued toalleviate the leak by siphoning oil from a gushing deepwater well and ponderingother options.
Watson said production by the San Ramon, Calf.-based company will rise 1% to2% through the middle of the decade, and 4% through 2017. The figures areconsistent with the production guidance the oil giant gave in March at itsanalyst meeting.
Watson confirmed that three major projects of more than $1 billion will startproducing this year: the Perdido Regional Hub in the deepwater Gulf of Mexico,the first expansion of the Athabasca Oil Sands Project in Canada and the thirdphase of the Escravos gas project in Nigeria.
The company plans to start production of seven multi-billion dollar projectsin 2011 and 2012. These projects, along with new start-ups, are forecasted todeliver 800,000 barrels a day by 2012, Watson said.
Chevron increased its production 7% last year.