Regional Overview (continued)

Former Soviet Union

KAZAKHSTAN

ExxonMobil participates in the Tengizchevroil (TCO) joint venture (ExxonMobil interest 25 percent), which includes a production license area of 380 thousand acres encompassing the Tengiz field, an associated processing plant complex, and the adjacent undeveloped Korolev oil field. TCO also holds a very prospective 608-thousand-acre exploration license that surrounds the production license.

The Tengiz field, located on the eastern shore of the Caspian Sea, is one of the world's largest oil fields, with recoverable resources estimated to be in excess of 6 billion barrels of oil. At the end of 1999, Tengiz crude oil production was about 210 thousand barrels per day. Production is expected to peak at 800 thousand barrels per day, with timing dependent on availability of pipeline capacity.

ExxonMobil also participates in the Caspian Pipeline Consortium (ExxonMobil interest 7.5 percent). The Consortium is developing a 900-mile crude export pipeline system from Tengiz via Russia to the Black Sea port of Novorossiysk. Pipeline construction began in 1999 and is projected to be complete in 2001.

In addition, ExxonMobil participates in a production sharing agreement (PSA) that covers almost 1.4 million acres in Kazakhstan's sector of the Caspian Sea area. ExxonMobil holds a 14.3-percent interest in the Offshore Kazakhstan International Operating Company (OKIOC) PSA. The first exploration well in the high-potential area began in 1999 and will be completed in 2000.

Tengiz Development

Target Production Rate Liquids 800 KBD Total Project Investment $4.7 billion ExxonMobil Working Interest 25%

Several projects are underway that will continue to expand field and plant capacity during 2000 and 2001. Decisions regarding the optimal type of future expansions are expected during 2000, which will lead to an integrated full-field development plan. Projects to be completed in 2000 are expected to increase production capacity by approximately 50 thousand barrels per day by year end.

AZERBAIJAN

ExxonMobil participates in three high-potential exploration blocks in the Azeri sector of the Caspian Sea: the Nakhchivan block (ExxonMobil interest 50 percent), the Oguz block (ExxonMobil interest 50 percent), and the Alov block (ExxonMobil interest 15 percent). ExxonMobil has signed two other PSAs that await ratification: Zafar Mashal (ExxonMobil interest 30 percent) and Lerik Deniz (ExxonMobil interest 30 percent).

The Caspian Sea Megastructure (ExxonMobil interest 8 percent) represents one of the largest offshore fields in the world, with estimated recoverable resources of over 6 billion barrels of oil and nearly 6 trillion cubic feet of natural gas. At year-end 1999, the Megastructure was producing about 110 thousand barrels per day as development drilling continued through the year. The initial phase of development utilizes an upgraded platform capable of producing 115 thousand barrels of oil per day. Development planning for estimated peak full-field production approaching 1 million barrels per day within 10 years is underway.

Megastructure Development

SAKHALIN ISLAND

ExxonMobil has a 30-percent interest in and operates the Sakhalin I blocks. The PSA for three Sakhalin I offshore fields was declared effective in 1996. Exploration drilling and development planning activities continue. In 1999, due to government delays in issuing permits, appraisal drilling on the Chayvo field was delayed. This key exploration well is now scheduled to be drilled in 2000. Chayvo is anticipated to be the first field developed under the Sakhalin I PSA. Marketing of gas from the Sakhalin I project has progressed with potential buyers in Japan, China, and Russia. A joint study was initiated with several Japanese companies to evaluate potential routes for a subsea export pipeline from Sakhalin to mainland Japan.

ExxonMobil continues to pursue government approval of PSAs for the Sakhalin III exploration blocks (ExxonMobil interests 33 percent to 67 percent). The Kirinsky block, southernmost of the Sakhalin III blocks, has been passed by the Duma for ratification by the government, and the remaining blocks have been entered into the Law of Lists for Duma approval.

TURKMENISTAN

ExxonMobil has a 40-percent interest in the Nebitdag concession, onshore western Turkmenistan (shown on map on page 43). Nebitdag includes existing production from the Burun field, and exploration opportunities.

The Garashsyzlyk concession (ExxonMobil interest 52.4 percent) lies adjacent to Nebitdag and includes most of Turkmenistan's onshore producing oil fields. ExxonMobil has rights to explore for oil outside the boundaries of existing producing fields, and in deeper areas below major fields such as Kotur Tepe and Barsa Gelmes, on this block.

Since signing a Joint Technical Study Agreement in April 1998, ExxonMobil has been evaluating the potential for exploration, development, and marketing to China of natural gas resources in the Amu Darya River area of eastern Turkmenistan.