capital lease balances were $9.8 billion at December 31, 2006, down from $12.9 billion at year-end 2005. The company also had minority interest obligations of $209 million, up from $200 million at December 31, 2005.

     The $3.1 billion reduction in total debt and capital lease obligations during 2006 included the early redemption and maturity of several individual debt issues. In the first quarter, $185 million of Union Oil Company bonds matured. In the second quarter, the company redeemed approximately $1.7 billion of Unocal debt prior to maturity. In the fourth quarter, a $129 million Texaco Capital Inc. bond matured, and Union Oil Company bonds of $196 million were redeemed prior to maturity. Commercial paper balances at the end of 2006 were reduced $626 million from year-end 2005. In February 2007, a $144 million Texaco Capital Inc. bond matured.

     The company’s debt and capital lease obligations due within one year, consisting primarily of commercial paper and the current portion of long-term debt, totaled $6.6 billion at December 31, 2006, up from $5.6 billion at year-end 2005. Of these amounts, $4.5 billion and $4.9 billion were reclassified to long-term at the end of each period, respectively. At year-end 2006, settlement of the reclassified amount was not expected to require the use of working capital in 2007, as the company had the intent and the ability, as evidenced by committed credit facilities, to refinance the amounts on a long-term basis. The company’s practice has been to maintain commercial paper levels it believes appropriate and economic.

     At year-end 2006, the company had $5 billion in committed credit facilities with various major banks, which permitted the refinancing of short-term obligations on a long-term basis. These facilities support commercial paper borrowings and can be used for general corporate purposes. The company’s practice has been to continually replace expiring commitments with new commitments on substantially the same terms, maintaining levels management believes appropriate. Any borrowings under the facilities would be unsecured indebtedness at interest rates based on the London Interbank Offered Rate or an average of base lending rates published by specified banks and on terms reflecting the company’s strong credit rating. No borrowings were outstanding under these facilities at December 31, 2006. In addition, the company has three existing effective “shelf” registration statements on file with the Securities and Exchange Commission that together would permit additional registered debt offerings up to an aggregate $3.8 billion of debt securities.

     In 2004, Chevron entered into $1 billion of interest rate swap transactions, in which the company receives a fixed interest rate and pays a floating rate, based on the notional principal amounts. Under the terms of the swap agreements, of which $250 million and $750 million will terminate in September 2007 and February 2008, respectively, the net cash settlement will be based on the difference between fixed interest rates and floating interest rates.

The company has outstanding public bonds issued by Chevron Corporation Profit