VOCELLAGRAPHIC.COM
Thursday, November 2, 2023
5
Oil & Ag
Energy powerhouse: BLM announces oil Chevron’s $53 billion acquisition of Hess
and gas lease sale in North Dakota
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By Chelsy Weisz, Editor
n a significant development, Chevron Corporation (NYSE: CVX) has announced its acquisition of Hess Corporation (NYSE: HES) in an all-stock deal worth $53 billion, with a total enterprise value, including debt, of $60 billion. Under the agreement, each Hess shareholder will receive 1.0250 shares of Chevron for each Hess share. This acquisition will substantially upgrade and diversify Chevron’s portfolio, enhancing its position in the energy sector. One of the highlights of this deal is the inclusion of the Tioga Gas Plant, a key energy facility in North Dakota. Constructed by Hess Corporation in 1954, it stands as one of the largest natural gas processing plants in the state. Significantly, the plant’s capacity to produce natural gas has more than doubled, and the propane supply to North Dakota tripled through major investments in 2014 and 2019. These upgrades also led to a reduction in wasteful flaring of natural gas liquids. Additionally, the Stabroek block in Guyana, known for its industry-leading cash margins and low carbon intensity, is part of the acquisition. This asset is expected to drive production growth well into the next decade. The merger will also strengthen Chevron’s presence in the U.S. shale sector, thanks to Hess’ Bakken assets, which complement Chevron’s operations in the DJ and Permian basins. The combined company is projected to achieve faster and longer-lasting
production and free cash flow growth rates, extending beyond Chevron’s existing fiveyear guidance. Chevron’s Chairman and CEO, Mike Wirth, emphasized the shared values and culture of both companies, focusing on safety, integrity, community involvement and financial excellence. Pierre Breber, Chevron’s CFO, anticipates that this addition will significantly expand Chevron’s free cash flow growth, supporting higher dividend per share growth and increased share repurchases. John Hess, CEO of Hess Corporation, expressed his pride in the company’s accomplishments. He emphasized their valuable growth portfolios, especially in Guyana, home to the largest oil discovery of the past decade, and the Bakken shale, where they hold a leading position in oil and gas production. With this merger, Hess expects to create a company that is stronger across all dimensions, better equipped to navigate the energy transition, and committed to delivering substantial shareholder value in the years to come. This strategic move underscores Chevron’s commitment to advancing its portfolio and leadership in the energy sector, solidifying its position as a global leader in the industry. Stay tuned for further updates on this transformative agreement between Chevron and Hess, including its impact on North Dakota’s energy landscape.
Winter’s arrival:
Honey bees and Farmers’ Almanac in perfect harmony By Chelsy Weisz, Editor
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s winter arrives earlier than many in North Dakota hoped for, the intriguing insights of honey bees into the season’s severity are coming to fruition. While the Farmers’ Almanac had already predicted a cold winter with above-normal snowfall, recent events in the northwest part of the state confirm the bees’ forecast with a winter storm that blanketed the region with over eight inches of snow and led to school closures. A few weeks ago, the venerable Farmers’ Almanac released its much-anticipated winter outlook for North Dakota, leaving little room for interpretation: it called for a frigid winter with above-average snowfall. The Almanac’s predictions have been known to be remarkably accurate over the years, making them a respected source for weather forecasting. Turning attention to a surprising source of weather forecasting, honey bees have been known to exhibit unusual behavior in anticipation of harsh winters. These diligent insects adjust their activities to ensure their colony’s survival during the cold months, including storing ample honey reserves. Researchers suggest that bees manage and predict weather by their sensitivity to changes in barometric pressure that gives them this uncanny ability. As a cold front approaches, air pressure drops, prompting bees
to become more active in their foraging. They instinctively gather extra nectar and pollen, anticipating the lean foraging opportunities that winter will bring. Additionally, bees have been observed reinforcing their hives with extra propolis, a resin-like substance collected from trees. This strengthening and insulation of the hive are done with greater diligence before a severe winter sets in, creating a protective barrier against the cold. Another noteworthy behavior is the early expulsion of drone bees from their hives as winter approaches. This year, many home beekeepers reported seeing drones kicked out up to six weeks earlier than in past years. This phenomenon adds to the intrigue of how honey bees adapt to impending winter conditions, further emphasizing their remarkable ability to anticipate and prepare for the colder months ahead. As winter unfolds, The Graphic will be closely monitoring both the Farmers’ Almanac and the honey bees to see how their predictions hold up. In the meantime, let’s appreciate the changing seasons and the incredible wisdom of the natural world around us.
Bureau of Land Management Press Release
he Bureau of Land Management Montana-Dakotas State Office today announced an oil and gas lease sale scheduled for Dec. 5, 2023, to offer 12 oil and gas parcels totaling 3,650.81 acres in North Dakota. The BLM completed scoping on these parcels in July 2023 and held a public comment period in August 2023 on the parcels, potential deferrals, and the related environmental analysis. A 30-day public protest period to receive additional public input opened today and will close Nov. 20, 2023. The parcels the BLM has analyzed, as well as maps and instructions on how to submit a protest are available on the BLM’s ePlanning website at: https://eplanning.blm. gov/eplanning-ui/project/2024323/510. As authorized under the Inflation Re-
duction Act, BLM will apply a 16.67 percent royalty rate for any new leases from this sale. More information about the Act is available on BLM’s online fact sheet. Leasing is the first step in the process to develop Federal oil and gas resources. Before development operations can begin, an operator must submit an application for permit to drill detailing development plans. The BLM reviews applications for permits to drill, posts them for public review, conducts an environmental analysis and coordinates with State partners and stakeholders. All parcels leased as part of an oil and gas lease sale include appropriate stipulations to protect important natural resources. Information on current and upcoming BLM lease sales is available through the National Fluid Lease Sale System.
