Chevron set to join the ranks of the ‘ultra majors’: reactions in the news

Chevron acquires shale producer Anadarko Petroleum to become one of the world’s largest energy giants, rivalling the likes of ExxonMobil and Shell.

We’ve explored some of the immediate reactions and analysis from the media below to find out what the industry thinks about this exciting turn of events. 

 “The sixth largest oil and gas deal in history.”
Chevron was already one of the top acreage holders in the Permian. This acquisition boosts Chevron's acreage by 240,000 net acres to over 1.4 million net acres in the Delaware Basin, where shale oil economics are probably the best in the country. – Forbes. Read more

Chevron-Anadarko: Nice Premium, But Focus on the Price. Considering how much oil has rallied, this deal is actually a bargain. – Bloomberg. Read more

Chevron joins oil ‘ultra majors’ with $33 billion Anadarko acquisition. “Chevron now joins the ranks of the ‘ultra majors’ – and the big three becomes the big four,” said Roy Martin, a senior analyst at consultants Wood Mackenzie. “The acquisition makes the majors’ peer group much more polarised. ExxonMobil, Chevron, Shell and BP are now in a league of their own.” – Resource Global Network Read more

Anadarko boss could net £49m from Chevron deal. His employment agreement entitles him to walk away with about $64 million (£49m) if he’s let go as part of the transaction or isn’t tapped to lead the combined entity, according to data compiled by Bloomberg. – EnergyVoice. Read more

The takeover puts Chevron neck-and-neck with the oil and gas production of Exxon Mobil Corp. and Royal Dutch Shell Plc, both of which have dominated Big Oil over the past decade. The combined company’s cash flow last year, $36.5 billion, would have exceeded Exxon’s. – Bloomberg. Read more

The combined companies are expected to produce more than 1.6 million barrels of oil equivalent per day (boepd) in the United States this year and 3.9 million boepd globally, according to Wood Mackenzie. – Reuters. Read more

The acquisition is the largest takeover in the global oil industry in three years and signals that shale drilling, which was once dominated by small and nimble independent companies, has now become a battleground for oil giants. It also demonstrates that the largest oil companies believe that they can profitably drill in shale fields even when crude oil prices are much lower than they were a decade ago. – New York Times. Read more

The deal will create a clearer class of "ultra major" energy companies and potentially trigger a buying spree by others seeking to follow suit, including Exxon Mobil and Royal Dutch Shell, industry analysts said. There's also a smaller chance those companies and others could still seek to outbid Chevron for Anadarko, which reportedly turned down a larger offer from Houston's Occidental Petroleum before agreeing to the Chevron deal that was seen as a better fit. Chron. Read more

Want to stay up to date with what’s happening in the Oil & Gas industry? Follow us @africaoilweek on social media for our weekly news roundups released every friday, and book your tickets now to continue the debate in November at Africa Oil Week 2019.