Chevron Set to Exit UK North Sea

Chevron is preparing to launch a sale process to divest all its remaining operations in the UK North Sea as it looks to focus on the most profitable assets in its portfolio and finalize the $53-billion acquisition of Hess Corporation.

With the planned divestment of its UK assets, Chevron would exit the basin after 55 years, the U.S. supermajor told Reuters in a statement on Thursday, confirming the plans.

Chevron, which has been active in the UK North Sea for more than 55 years, holds a 19.4% non-operated working interest in the Clair Field and associated assets—one of the largest oil and gas fields offshore the UK.

Chevron also has a small stake in the Sullom Voe oil terminal on the Shetland Islands, which will also be put up for sale, as well as the interest in the Ninian pipeline SIRGE pipeline systems connected with Sullom Voe, the U.S. supermajor told Reuters.

Chevron is expected to launch the process to sell its remaining UK assets next month, and they are expected to raise up to $1 billion excluding tax benefits, industry sources told Reuters. 

Six years ago, the U.S. major quit its only asset offshore Norway as the international energy giants started reorganizing their portfolios.

Chevron has now carried out another review of its global portfolio and has apparently concluded that its UK assets are no longer core to its development strategy.  

Chevron is currently focused on completing its acquisition of U.S. firm Hess but has yet to finalize the deal.

Last month, Hess said that Chevron’s acquisition could be delayed until next year due to Exxon Mobil’s arbitration case.

Chevron’s proposal to buy Hess is getting increased scrutiny from regulators and politicians, while the supermajor is locked in an arbitration procedure with the other U.S. giant, Exxon, regarding Exxon’s right to first refusal for Hess’s stake in the Exxon-led huge oil projects offshore Guyana.   

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

• Oil Prices Climb on a U.S. Inventory Draw and Inflation Optimism
• Memorial Day Travel Expected to Near Record High
• The IEA Has Cut Its Oil Demand Growth Forecast for 2024