Chevron acquires Anadarko for $33 billion

Images: Epoxy Oilserv Limited

U.S.-based super major Chevron announced on Friday that it has signed an agreement to acquire Anadarko, an exploration-production company based in Texas that has assets in Algeria, Mozambique, Ghana, South Africa and key assets in shale-producing parts of the southern United States.

The total cost of the transaction amounts to $50 billion, taking into account a cash and stock deal for $33 billion and Anadarko’s $15 billion debt, assumed by Chevron. It agreed to pay $65 per share of Anadarko, a 39 percent increase since the company’s last closing price the night before the deal announcement.

Aside from acquiring a highly prospective Mozambique LNG Project asset in East Africa and several licenses across the continent, Chevron will reinforce its leading position in the Permian Basin. The acquisition allows Chevron’s acreage to reach 240,000 net acres over 1.4 million in the Delaware Basin. Globally, Anadarko is a leading independent explorer and producer holding the equivalent of 1,5 billion barrels of proven petroleum reserves.

In Africa, Anadarko has held a production sharing agreement (PSC) with Algerian national oil company Sonatrach since the 1980s.

Last year, the company celebrated 20 years of oil production in the country.

Anadarko is also present in Ghana’s Jubilee field and the adjacent TEN field, for a total of 250 million barrels of oil equivalent produced since 2010.

In Mozambique, Anadarko made its first discovery in 2010 in the Offshore Area 1 of the deep-water Rovuma Basin, launching one of the most important natural gas discoveries in the last 20 years, while in South Africa, it is in early exploration stages operating offshore Block 5/6/7, which covers more than 23 million acres.

The Chevron-Anadarko deal is expected to be approved in the second half of the year. It is subject to Anadarko’s shareholders and regulators’ approval.