Page 9 - NorthAmOil Week 36 2021

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Chevron reportedly seeking

to exit Eagle Ford

TEXAS SUPER-MAJOR Chevron is seeking a sale of its Chevron acquired the Eagle Ford assets as
assets in the Eagle Ford shale play in Texas, as part of its takeover of Noble Energy last year.
part of efforts to regularly review its portfolio. They span 30,440 net acres (123 square km)
The news was reported by Reuters, which and had net production of 30,300 barrels of oil
cited sources familiar with the matter, as well as a equivalent per day (boepd) in 2021, according to
marketing document it had seen. Reuters added the marketing document. Natural gas accounted
that a Chevron spokesman had confirmed that for around 45% of output. Data analytics firm
the company was marketing the assets. Enverus commented that output levels from
According to the document, Chevron esti- the assets are down by nearly a quarter from the
mates that the proven, developed resources 40,000 boepd they produced in 2020, according
across the properties could be worth around to a supplement to Chevron’s 2020 annual report.
$1bn at oil prices of $70 per barrel and natural The news comes after earlier moves by Chev-
gas prices of $4 per million British thermal units ron to step up its asset sales and take advantage
($110.64 per 1,000 cubic metres). of higher oil and gas prices. In June, the company
Those are the resources that would be 90% put two packages of conventional oil and gas
or more likely to be produced profitably at assets in the giant Permian Basin on the market.
those levels of oil and gas prices. If undeveloped Enverus’ senior M&A analyst, Andrew Ditt-
resources are included, the assets could be worth mar, was cited by Reuters as saying Chevron
up to $3.8bn at the same prices, the document was likely hoping to capitalise on a resurgent
said. Eagle Ford mergers and acquisitions (M&A)
Reuters cited two of the sources as saying buy- market largely driven by interest from private
ers were likely to bid $1-2bn for the assets. equity buyers.™

GeoSouthern reportedly

explores asset sale

LOUISIANA BLACKSTONE-BACKED Haynesville shale advantage of the improved commodity price
gas producer GeoSouthern is exploring options environment to sell off other oil companies. The
that include a sale of its acreage for $2bn, Reuters firm is the largest shareholder in Vine Energy
reported this week, citing sources familiar with – another Haynesville player – which is in the
the matter. process of being acquired by Chesapeake Energy
According to the sources, the entity for sale for $615mn. Blackstone also backed Appala-
is formally called GEP Haynesville – a joint ven- chian Basin producer Alta Resources, which
ture between a company founded by billionaire was sold to EQT in July for $2.9bn, and agreed
George Bishop and Blackstone’s credit arm. The last month to sell Permian basin oil producer
entity acquired land in the Louisiana portion of Primexx Energy Partners to Callon Petroleum
the Haynesville shale from Ovintiv, which was for $788mn.
then known as Encana, for about $850mn in The Haynesville has seen a significant share
2015. of the consolidation playing out across the shale
The sources said that a deal was not certain, industry over the past year. Higher natural gas
and neither GeoSouthern nor Blackstone have prices and proximity to the US Gulf Coast, where
commented publicly on the matter. However, gas can be used to serve petrochemical plants
it would not be the first time that GeoSouth- and LNG export terminals, have both contrib-
ern and Blackstone have offloaded assets – they uted to its popularity among buyers.
developed 82,000 net acres (332 square km) in However, Pioneer Natural Resources’ CEO,
the Eagle Ford shale in South Texas and sold this Scott Sheffield, said this week that he expected
joint venture to Devon Energy in early 2014 for consolidation to slow over the next two years
$6bn. amid dwindling cash and concerns over
Elsewhere, Blackstone has also been taking future demand.™

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