Chevron Sticks With Project in Kazakhstan : Oil: Company says cut in spending there was planned and does not indicate pessimism.

Chevron Corp. denied Monday that its decision to slash spending on the huge Tengiz oil project in Kazakhstan reflects pessimism about the project’s future.

Rather, the decision to cut spending from a reported $360 million last year to somewhat more than $50 million in 1995 was planned months ago and is not a reaction to any problems with the project, said spokesman Mike Libbey at Chevron’s San Francisco headquarters.

Libbey said the company feels that it already has invested most of its share in the first phase of a joint venture with the government of Kazakhstan to develop the field that is expected to hold as much as 9 billion barrels of recoverable oil.

Since April, 1993, when the project went forward, Chevron has invested roughly $1 billion, Libbey said. Chevron has said it planned to spend $1.5 billion in the project’s first three to five years as part of the first phase of development.

“We remain optimistic that we’re going to see a positive outcome from this whole project,” Libbey said.

On Monday, the Wall Street Journal reported that Chevron was slashing spending on the Tengiz oil field for the second time in less than a year.

Chevron Vice President Espy Price was quoted as saying that construction delays until at least 1996 are the result of lower than anticipated revenue from the project. But Chevron said that it still intends to spend $20 billion on the project over 40 years.

Production at the 200-square-mile field in the former Soviet republic has fallen well below the level Chevron had estimated.

Chevron projected production at 130,000 barrels a day by 1995 and 260,000 by 1998.

But the company is producing only about 65,000 barrels a day, owing to limits placed on production by the Russian government.