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Highlights

  • Chevron completed the acquisition of Hess, issuing approximately 301 million shares in an all-stock transaction.
  • The combined portfolio includes a 30% stake in Guyana’s Stabroek Block with over 11 billion barrels of oil equivalent.
  • Chevron expects USD 1 billion in annual run-rate cost synergies by the end of 2025.

Chevron Corporation (NYSE: CVX) has completed its acquisition of Hess Corporation (NYSE: HES) after fulfilling all regulatory and closing requirements, including a favorable arbitration ruling related to Hess’ Guyana asset. The all-stock transaction results in Hess shareholders receiving 1.0250 Chevron shares for each Hess share held. Chevron will issue approximately 301 million shares of its common stock to Hess stockholders, while 15.38 million Hess shares previously acquired by Chevron were canceled.

The acquisition adds significant assets to Chevron’s portfolio, including a 30 percent stake in the Guyana Stabroek Block, where over 11 billion barrels of oil equivalent in recoverable resources have been discovered. Other additions include 463 thousand net acres in the Bakken, production assets in the Gulf of America producing 31 thousand barrels of oil equivalent per day, and Southeast Asian gas assets producing 57 thousand barrels of oil equivalent per day.

Following the merger, the combined company’s capital expenditure range is projected at USD 19 billion to USD 22 billion. Chevron also targets a sustained double-digit Return on Capital Employed at mid-cycle pricing. CFO Eimear Bonner stated the company expects to realize USD 1 billion in annual cost synergies by the end of 2025. The transaction is anticipated to be accretive to Chevron’s cash flow per share by 2025.

Chevron plans to provide updated long-term financial and operational guidance reflecting the acquisition at its upcoming Investor Day on November 12 in New York City.