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  • Writer's pictureCameron McNeill

Chevron’s Acquisition of Hess: Implications for the Future of American Energy

Written By: Cameron McNeill

Edited By: Kyra Odell

In May of 2015, ExxonMobil research teams in Guyana discovered over 90 meters of oil-bearing sandstone reservoirs, a discovery that indicates these offshore reserves hold approximately 11 billion barrels of viable oil. This was, without a doubt, the greatest oil discovery in the past decade, and one that set the stage for Guyana’s position as one of the fastest-growing oil producers in the world. Since this discovery, Exxon Mobil has begun five major oil developments off the coast of Guyana, attracting the interest of the world's most dominant energy players. Chevron, second to Exxon Mobil as the largest integrated energy company in the United States and responsible for 34% of the world's refined oil supply, expressed a desire to take advantage of Guyana’s extensive offshore supply. This led to a $53 billion acquisition, their biggest deal to date (Chevron: Highlights of Operations, 2023). What, then, are the details of this transaction and why is it relevant to the industry at large?

The $53 billion dollar deal was an all-stock buyout of the American energy company Hess. The company focuses primarily on offshore drilling operations both in the Americas and Southeast Asia, with their most lucrative operations taking place in Guyana. They hold a 25% share in Kaieteur Block, and a 30% share in Stabroek Block, both of which sit roughly 200 km off the coast of Guyana (Hess Operations Map, 2023). Blocks are designated offshore areas that are within the coastal waters of a controlling country - in this case, Guyana. The recent determination of Stabroek Block as a viable location for a new oil project was central in Hess’ 43,000 boepd (barrels of oil equivalent per day) increase from 2022, and was an indicator to Chevron of their position as a gateway to the 11 billion barrels of untapped oil below the Guyanese seafloor (Johnston, Smyth, McCormick, & Sheppard, 2023). The news was released in April of this year and was followed by Hess’ purchase just five months later, a strong signal of the value that their 30% stake represents to Chevron.

While this acquisition makes Chevron’s desire to break into the Guyanese oil supply clear, it also speaks more broadly to a unique operational approach that they are taking alongside Exxon Mobil. Unlike their European counterparts such as Shell, who increased their annual renewables spending by 50% in 2022, Chevron and Exxon Mobil are continuing to lean into petroleum investment (Bennett & Mathis, 2023). Despite this, they share the same goal of net zero by 2050 as their European counterparts. The decision to not only continue investing in petroleum reserves, but to additionally make their biggest acquisition to date - one that is focused on expanding their offshore drilling operations - seems like a startling contrast to what we should expect from this industry.

To better understand this strategy, we need to look at their expectations for the future energy landscape. Exxon Mobil’s projections actually indicate that global fuel demand (measured in BTU’s) will continue to be dominated by oil, natural gas, and coal all the way through 2040 (ExxonMobil Global Demand by Fuel, 2023). A projection such as this makes it clear that they are expecting to not only maintain their current operations but also increase their scale significantly in order to fulfill global needs. Their metrics make it apparent where they stand in respect to long-term planning and are echoed through the extent of their Guyanese holdings. This approach likely influenced Chevron’s decision to buy into the Guyanese oil reserves and prepare for another two decades of oil supremacy. Considering that Exxonmobil is responsible for roughly 55% of the global energy supply, it should not be surprising that their long-term forecasts would have an impact on the strategy of other national players like Chevron.

So why is Chevron’s decision to purchase Hess so meaningful for the American energy industry at large? Essentially, it is a reflection of a greater trend: oil will remain a continued driver of American energy. While this idea may contrast the sustainability-focused PR campaigns of today's corporations, it is important as consumers to understand where the overwhelming majority of our fuel is really coming from. With no shortage of supply, and demand levels that continue to rise, this is a reality that seems certain.



Bennett, D., & Mathis, W. (2023, February 8). Shell’s Grand Plan to Fight Climate Change (and Continue to Cause It).

Chevron. (n.d.). United States Highlights of Operations. Retrieved November 15, 2023, from website:

Exxon Mobil. (n.d.). Operations: Oil. Retrieved November 15, 2023, from

Hess Corporation. (n.d.). Hess Operations Map. Retrieved November 15, 2023, from website:

Johnston, I., Smyth, J., McCormick, M., & Sheppard, D. (2023, October 23). Chevron to buy US oil producer Hess for $53bn. Financial Times.

Kumar, A., Hampton, L., Valle, S., & Valle, S. (2023, April 26). Hess discloses new discovery in Guyana as profit tops estimates. Reuters.

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