[ 2023 ]

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CHEVRON TO ACQUIRE HESS

Chevron Corp . announced that it entered into a definitive agreement with Hess Corp . to acquire all of the outstanding shares of Hess in an all-stock transaction valued at $ 53 billion , or $ 171 per share based on Chevron ’ s closing price on October 20 , 2023 . Under the terms of the agreement , Hess shareholders will receive 1.0250 shares of Chevron for each Hess share . The total enterprise value , including debt , of the transaction is $ 60 billion .

The acquisition of Hess upgrades and diversifies Chevron ’ s already advantaged portfolio . The Stabroek block in Guyana is an extraordinary asset with industry leading cash margins and low carbon intensity that is expected to deliver production growth into the next decade . Hess ’ Bakken assets add another leading U . S . shale position to Chevron ’ s DJ and Permian basin operations and further strengthen domestic energy security . The combined company is expected to grow production and free cash flow faster and for longer than Chevron ’ s current five-year guidance . In addition , John Hess is expected to join Chevron ’ s Board of Directors .

“ This combination positions Chevron to strengthen our long-term performance and further enhance our advantaged portfolio by adding world-class assets ,” said Chevron Chairman and CEO Mike Wirth . “ Importantly , our two companies have similar values and cultures , with a focus on operating safely and with integrity , attracting and developing the best people , making positive contributions to our communities and delivering higher returns and lower carbon .”

“ Building on our track record of successful transactions , the addition of Hess is expected to extend further Chevron ’ s free cash flow growth ,” said Pierre Breber , Chevron ’ s CFO . “ With greater confidence in projected long-term cash generation ,

Chevron intends to return more cash to shareholders with higher dividend per share growth and higher share repurchases .”

“ This strategic combination brings together two strong companies to create a premier integrated energy company ,” CEO John Hess said . “ I am proud of our people and what we have achieved as a company , which has one of the industry ’ s best growth portfolios including Guyana , the world ’ s largest oil discovery in the last 10 years , and the Bakken shale , where we are a leading oil and gas producer . Chevron has a world-class diversified portfolio of assets and one of the industry ’ s strongest balance sheets and cash return profiles . I believe our strategic combination creates a company that is stronger in every respect , with the leadership , asset portfolio and financial resources to lead us through the energy transition and deliver significant shareholder value for years to come .”

24 NOVEMBER 2023 | FUEL OIL NEWS | www . fueloilnews . com