ChevronTexaco increases target for annual \savings
  by: OilOnline
  Thursday, June 20, 2002

ChevronTexaco Corp.increased its merger-related synergy target to $2.2 billion, an annual before-tax rate to be achieved by April 2003. The company also said it expects to meet its previously announced $1.8 billion annual synergy objective by October 2002, or six months ahead of schedule.

In a presentation to security analysts, Chairman and CEO Dave O'Reilly said, "In the eight months since completing our merger, ChevronTexaco moved swiftly and successfully to integrate its businesses and to put in motion aggressive plans to enhance upstream performance and improve downstream returns. One benefit is that we expect synergies to be at a $1.8 billion annual rate by October of this year, or six months earlier than our initial projection. And in the process we have been able to identify an additional $400 million in synergies we expect to capture by April 2003. Since announcing the merger in October 2000, we have almost doubled our initial synergy target.

"Taken together, the plans we have outlined today are designed to achieve within two years, a 2 to 3 percent improvement in our return on capital employed," said O'Reilly, who also emphasized that the company's overarching objective is to be first among its peers in total stockholder return for the five-year period ending in 2004.