Never second guess a Chevy when it’s driven by Mike Wirth. The Chevron CEO, who steers the wheel of the nation’s second-largest energy major, has made a game-changing acquisition that may be less about accumulating more domestic shale assets, boosting the company’s Gulf production, or gaining 10 gas fields in Southeast Asia—and more about a strategic swerve into Guyana, the South American Crude Oil Gift that Keeps Giving.
Reese Energy Consulting today is following the latest from Calif.-based Chevron, which has scooped up independent Hess Corporation in an all-stock deal valued at $53 billion. While Chevron operates more tentacles than a lab-created super octopus banking $6 billion in 2Q, its upstream earnings on both the U.S. (Calif., Gulf, DJ, and Permian) and international sides took a sizable hit, coming in at $4.9 billion vs $8.5 billion in 2Q 2022.
In the Permian, however, Chevron achieved record production where it holds 2.3+ million acres. Given the current consolidation at play there, one might easily conclude Chevron would follow rival ExxonMobil and its $60 billion merger with Pioneer Natural Resources.Instead, Wirth popped the Chevy clutch to diversify its upstream business, taking home the 30% stake Hess holds in Exxon’s offshore Guyana developments where recoverable resources from its Stabroek Block are estimated at 11+ billion BOE. More than 1.2 MMBPD are expected to go online by 2027. That oughta add some juice to the tank.