Chevron Corp. is offering to sell about 73,000 acres (29,540 hectares) of oil and gas properties in New Mexico, according to documents viewed by Reuters, as oil firms accelerate divestitures in a rebounding oil market.
Sales in the Permian Basin of West Texas and New Mexico have jumped as shale producers and private-equity firms seize on a sizzling recovery in oil prices to buy companies or secure new drilling prospects.
Chevron set a May 20 deadline for bids on acres holding more than 1,000 producing wells with $1.1 million in combined monthly revenue, according to a sales document. Some of the properties are operated by ConocoPhillips Co., BXP Operating LLC and Providence Energy Services Inc., the document showed.
“Chevron has an ongoing and methodical program to evaluate and prioritize its assets,” spokeswoman Veronica Flores-Paniagua said, confirming the New Mexico’s Lea County offer. She declined to say what the company hopes to get for the assets.
The properties could fetch about $100 million, according to one analyst who reviewed the parcels but declined to be named because he was not authorized to speak on the matter. The wells are in conventional fields in the Permian’s Central Basin, not in the more desirable Midland and Delaware areas, the person said.
“Current valuations are favorable for buyers and we expect private equity to be strategic players largely via consolidation and growth of existing portfolio companies,” said Brian Lidsky, managing director at energy investment bank Entoro Capital LLC.
U.S. oil is trading in the mid-$60s/bbl this year, helping trigger a revival in deals. Commodities trader Vitol last week bought 44,000 acres (17,800 hectares) in the Permian from Hunt Oil Co. for about $1 billion.
2022-08-19 - The U.S. oil and gas rig count fell by one to 762 in the week to Aug. 19, Baker Hughes said. That was the first time drillers cut the rig count for three consecutive weeks since July 2020.
2022-08-19 - The divestiture includes approximately 47,025 net acres of Montney rights on land north of the Peace River with no associated production or facilities, according to Crew Energy.
2022-08-19 - LLOG Exploration Offshore and Audubon Engineering Co.'s collaborative efforts will make LLOG's Salamanca project the first repurposed hub in the U.S. Gulf of Mexico.
2022-08-19 - Aker Energy, controlled by Aker ASA, owns 50% of the deepwater block off Ghana where the Pecan Field is located, while Lukoil holds 38%, Ghana National Petroleum Corp. has 10%, and Fueltrade 2%.
2022-08-18 - Kazakh President Kassym-Jomart Tokayev met Chevron CEO Michael Wirth in Kazakhstan on Aug. 18 and also discussed with him potential investments in petrochemicals and the expansion of Karachaganak, another giant oil project.