Chevron Corporation has completed its acquisition of Hess, following the successful resolution of all closing conditions, including a favorable arbitration outcome regarding Hess’ offshore assets in Guyana.
The merger significantly enhances Chevron’s global portfolio with top-tier assets in Guyana and the U.S. Bakken, supporting its leadership in key energy markets. Chevron now holds a 30% stake in the Guyana Stabroek Block, containing over 11 billion barrels of oil equivalent in recoverable resources, and gains substantial acreage and production from the Bakken, Gulf of Mexico, and Southeast Asia.
Under the merger agreement, Hess shareholders will receive 1.0250 shares of Chevron for each Hess share. Chevron plans to issue about 301 million shares of common stock to Hess stockholders, while 15.38 million previously acquired Hess shares will be canceled.
Key benefits of the acquisition include:
— Increased Cash Flow and Growth: Expected to be accretive to cash flow per share in 2025, with growth extending into the next decade.
— Capital Efficiency: Projected capital expenditures between $19 billion and $22 billion, with aims for double-digit Return on Capital Employed (ROCE) and $1 billion in cost synergies by the end of 2025.
Chevron will provide updated financial guidance reflecting the acquisition at its Investor Day in New York City on November 12.
KEY QUOTES:
“This merger of two great American companies brings together the best in the industry. The combination enhances and extends our growth profile well into the next decade, which we believe will drive greater long-term value to shareholders. Additionally, I’m pleased with the FTC’s unanimous decision. John is a respected industry leader, and our Board would benefit from his experience, relationships and expertise.”
Chevron Chairman and CEO Mike Wirth
“We are proud of everyone at Hess for building 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. The strategic combination of Chevron and Hess creates a premier energy company positioned for the future.”
Former Hess Corporation CEO John Hess
“This accretive transaction is expected to drive significant free cash flow and production growth into the 2030s. We are quickly integrating our two companies and expect to achieve $1 billion in annual run-rate cost synergies by the end of 2025. All of this should enable even higher returns to shareholders over the long-term.”
Chief Financial Officer Eimear Bonner
