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Page added on October 30, 2008

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Chevron Project Offers Glimpse Of Future: More Work, Less Oil

RIO DE JANEIRO — Chevron Corp. executive Ali Moshiri spent the past seven years scouring the globe for hard-to-get equipment, schmoozing foreign officials and taking billion-dollar risks to fast-track a new oil prospect off the coast of Brazil.

Despite the full-out effort, Mr. Moshiri concedes Chevron’s $3 billion Frade (pronounced Frah-jay) project is a mediocre prospect compared with the huge pools of easy-to-get oil the company has tapped in the past. Even if it fulfills its greatest promise, the deep-water oil field will contribute only a trickle to the global river of petroleum. And Frade, whose first well is now being drilled, could still fail to deliver enough oil to make all the effort worthwhile.

But Mr. Moshiri remained dedicated to the project for a simple reason: It’s about as good as it gets these days. For oil companies seeking to reverse years of falling production, the consuming and expensive birthing of Frade has become the norm.

Big Western oil companies such as Chevron once had the run of the world’s biggest oil fields, known in the industry as elephants. Not anymore. Today, they are locked out of the best prospects by uncooperative governments. “If you’re only going after elephants, you’ll never hunt,” says Mr. Moshiri, sitting in his wood-paneled office in a downtown Houston skyscraper.

Wall St. Journal

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