Chevron acquires Noble Energy in landmark $5 billion deal

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On Monday, Chevron Corp. (NYSE: CVX) announced an acquisition agreement for Noble Energy (NASDAQ: NBL) at $5 billion. This marks the largest energy deal since the onset of the COVID-19 pandemic, which has devastated the oil and gas industries due to a decline in industrial oil prices and decreased consumer demand.

Commenting on the benefits of the deal, Chevron CEO Michael Wirth said, “This is a cost-effective opportunity for Chevron to acquire additional proved reserves and resources. Noble Energy’s multi-asset, high-quality portfolio will enhance geographic diversity, increase capital flexibility, and improve our ability to generate strong cash flow.”

The deal will increase Chevron’s oil and gas reserves by 18% with assets in the U.S. and abroad, including reserves in Israel and West Africa. Overall, the inclusion of Noble Energy’s portfolio will increase the company’s global presence.

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Chevron is poised to be one of the first behemoth energy producers to gain large-scale access to Israeli resources, undoubtedly increasing the company’s influence in the Eastern Mediterranean. That said, Chevron’s ownership of Israeli assets raises diplomatic questions since the company has a history of doing business with other big players in the region, including the UAE and Saudi Arabia, both vociferous opponents of Israel.