Chevron Buys Anadarko Petroleum For $33 Billion

Apr 12, 2019

Oil giant Chevron announced it's acquiring Anadarko Petroleum for $33 billion. The deal makes Chevron the seventh largest national oil company, according to Rystad Energy.

Anadarko submitted the second most applications for permits to begin drilling in Wyoming last year, but it trailed behind in actual production. Carl Larry, market development manager with Refinitiv, a global provider of financial market data, said that's likely to change with Chevron's purchase of the company.

"Chevron has the assets, has the capabilities, has the acumen to come into Wyoming and develop it and create more opportunities," Larry said.

With the purchase, Chevron expects to improve its position in the Permian Basin, extend its infrastructure network in the Gulf of Mexico, and generally improve its natural gas holdings.

Phil Flynn, senior market analyst with the PRICE futures group, said it's clear Chevron is investing in the shale revolution.

"They're coming in and making these purchases because we know in the long term the world's going to need more oil. They're going to need a lot more natural gas. Chevron is taking advantage of that," Flynn said.

He said it's possible layoffs could occur in front offices due to overlap between the two companies. But in general, Flynn said he expects positive things.

"Our expectation is that they're going to keep the same amount of jobs if not increase jobs at some point down the road."

By the end of 2018, Anadarko had 1.47 billion barrels-equivalent of proved reserves. Chevron's purchase of the company is expected to close in the second half of 2019.