Chevron Corp. will cut about 100 jobs in Richmond -- but the energy giant also said Thursday that it will ease the sting of employment cutbacks in San Ramon and Concord by reducing layoffs planned in those cities.

Now, an estimated 275 Chevron workers in San Ramon and Concord will avoid layoffs compared with what the company had initially proposed.

"The number of anticipated layoffs is lower than we originally estimated, and the layoffs will occur over a longer time frame than we expected," said Sean Comey, a Chevron spokesman.

The shift in employment plans for Chevron is linked to the company's plans to sharply reduce its refinery, retail and transportation operations -- also known as its downstream business -- in a wrenching restructuring.

San Ramon-based Chevron previously had sketched plans to reduce its downstream work force by 3,900 employees. That amounts to roughly 20 percent of that organization's staff, Comey said.

The latest developments in the refinery, retail and transportation operations will eliminate some jobs and rescue others:

  • In Richmond, Chevron will eliminate 95 jobs, primarily in the company's technology research center, which is located next to the company's vast refinery. Those layoffs are due to occur in October and November. These cutbacks were outlined in an official company filing with state labor officials.

  • In San Ramon, the company will eliminate 500 downstream employees, Comey said. Previously, Chevron had planned to reduce its San Ramon work force by 620. The jobs saved in San Ramon total 120.

  • In Concord, Chevron now intends to eliminate 150 employees. The original plan was to cut 305 jobs, a move that saves 155 jobs.

    "The primary reason the number of employees affected is lower than we originally estimated is due to successful efforts to redeploy impacted employees to other open positions within the company," Comey said.

    Another hopeful sign: The job cuts are scheduled to be complete by the end of 2011. The original proposal was for the layoffs to conclude by this coming March. So far, about 50 East Bay employees have been laid off.

    The extended period of time will give Chevron greater flexibility to place more employees in open positions with the company.

    "The downstream business for Chevron and other oil companies has improved, but it's still on shaky ground," said Brian Youngberg, an analyst with St. Louis-based investment firm Edward Jones & Co. "Until the economy picks up and refining margins are better, it's hard to see a major improvement in downstream."

    During the April-June quarter, Chevron earned $975 million on its downstream operations, much more than the profit of $131 million in the year-ago second quarter. Demand for gasoline has increased after a two-year slump.

    "The second quarter marked a significant turnaround in refining margins," said Pavel Molchanov, an analyst with Houston-based Raymond James & Associates, an investment company. "Every refiner in the U.S., including Chevron, has seen a big recovery in its second-quarter downstream operations."

    Chevron's downstream units in the United States earned $433 million during the second quarter. That contrasted with a loss of $131 million for the year-ago quarter.

    The company's downstream business had struggled greatly before the spring, partly because gasoline prices had not risen nearly as quickly as crude oil prices. Lately, however, the gap between crude oil and refined gasoline has narrowed in favor of gasoline prices.

    Despite the improvements, Chevron's downstream woes are not over.

    "Chevron expects those challenges will continue for the next few years," Comey said. "We appreciate this has been a challenging time for many employees."

    Contact George Avalos at 925-977-8477.