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Chevron to Cut 2,000 Jobs, Sell Assets

SAN RAMON, Calif. -- Chevron Corp. will cut 2,000 jobs this year and sell some overseas operations, representing nearly 12 percent of its 17,000 workers in its downstream unit and a little more than 3 percent of its overall work force, The Associated Press reported.

The plan was announced by executives yesterday at a meeting with financial analysts in New York. During the meeting, the company said it has plans "to improve returns by aggressively lowering costs, exiting markets and streamlining the organization."

Mike Wirth, executive vice president, Global Downstream, noted Chevron's 2009 downstream performance, cost reduction efforts and market exits.

"Downstream market conditions are likely to be difficult for the next several years. We intend to further concentrate our downstream portfolio in North America and Asia-Pacific," he said. "These are markets in which we have our greatest competitive strength. We are also rapidly and aggressively lowering costs, reducing capital spending, improving efficiency and simplifying our organization."

Wirth also outlined plans to streamline Chevron's downstream portfolio, including soliciting bids for certain operations in Europe, the Caribbean and select Central America markets; reviewing operations in Hawaii and Africa, outside of South Africa; and reducing the downstream workforce through 2011, with around 2,000 positions eliminated in 2010.

First quarter 2010 charges for severance as a result of the reduction are currently estimated to be in the range of $150 million to $200 million on an after-tax basis.

The company also detailed its strong performance in other segments in 2009.

"2009 was an outstanding year, capping a decade of performance improvements achieved through consistency in strategy and execution. We have momentum, an advantaged portfolio and proven capabilities that will continue to deliver value to our stockholders," John Watson, Chevron's chairman and CEO, said in a statement. "Chevron has held a long-term view favoring aggressive upstream investment, and the company is poised for another decade of upstream growth."

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