Chevron to Sell 25% Working Interest in U.S. Offshore Acreage

Chevron Corporation CVX, the U.S. oil and gas giant, has signed an agreement with French energy major TotalEnergies SE TTE for the sale of working interests in 40 exploration leases, currently operated by CVX. The French energy firm stated that it had acquired a 25% working interest in 40 Outer Continental Shelf (“OCS”) leases operated by Chevron.

Details of the Offshore Blocks

These federal leases operated by CVX cover an area of approximately 1,000 square kilometers. These offshore blocks are located approximately 175-330 kilometers off the coast, with 13 blocks in the Walker Ridge area, 18 in East Breaks and the remaining in the Mississippi Canyon area.

Deepening Strategic Partnership

This acquisition strengthens the partnership between Chevron and TotalEnergies beyond their previous collaborations. TotalEnergies’ existing partnerships with CVX include Ballymore, in the Gulf of America, where Chevron is the operator of the block with a 60% interest and TotalEnergies has a 40% stake. The two energy firms also work together in the Anchor, Jack and Tahiti projects in the Gulf of America.

This transaction is expected to provide TTE with access to several offshore exploration prospects. This aligns with the company’s objective to expand its exploration portfolio, adding assets that are cost-efficient and have a low emission profile. TotalEnergies mentioned that this transaction also allows it to grow its exploration acreage in the United States with exposure to an extensive array of geological plays.

The latest acquisition extends the long-standing relationship between CVX and TTE, building on the success of their previous projects as partners, including the startup of the Ballymore project this year and the Anchor project, which achieved its first oil last year. Furthermore, the company expects using cutting-edge tools and technologies, including advanced 3D imaging, to tap into the remaining production potential of U.S. offshore oil and gas assets.

CVX’s Zacks Rank & Key Picks

CVX currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the energy sector are Oceaneering International OII and RPC, Inc. RES, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oceaneering International delivers integrated technology solutions across all stages of the offshore oilfield lifecycle. The company is a leading offshore equipment and technology solutions provider to the energy industry. OII’s proven ability to deliver innovative, integrated solutions supports ongoing client retention and new business opportunities, ensuring steady revenue growth.

RPC generates strong and stable revenues through a diverse range of oilfield services, including pressure pumping, coiled tubing and rental tools. The company is strongly committed to returning value to its shareholders through consistent dividend payments and share buybacks, making it an attractive choice for investors seeking steady returns.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research