Chevron gets green light on $53 billion Hess acquisition

Mega Deal

With the deal, Chevron gets access to one of the biggest oil finds of the decade. Photo via Chevron

Chevron has scored a critical ruling in Paris that has given it the go-ahead for a $53 billion acquisition of Hess and access to one of the biggest oil finds of the decade.

Chevron said Friday that it completed its acquisition of Hess shortly after the ruling from the International Chamber of Commerce in Paris. Exxon had challenged Chevron’s bid for Hess, one of three companies with access to the massive Stabroek Block oil field off the coast of Guyana.

“We disagree with the ICC panel’s interpretation but respect the arbitration and dispute resolution process,” Exxon Mobil said in a statement on Friday.

Guyana is a country of 791,000 people that is poised to become the world’s fourth-largest offshore oil producer, placing it ahead of Qatar, the United States, Mexico and Norway. It has become a major producer in recent years.

Oil giants Exxon Mobil, China’s CNOOC, and Hess squared off in a heated competition for highly lucrative oil fields in northern South America.

With Chevron getting the green light on Friday, it is now one of the major players in the Stabroek.

“We are proud of everyone at Hess for building one of the industry’s best growth portfolios including Guyana, the world’s largest oil discovery in the last 10 years, and the Bakken shale, where we are a leading oil and gas producer,” former Hess CEO John Hess said in a statement. “The strategic combination of Chevron and Hess creates a premier energy company positioned for the future.”

Chevron also said that on Thursday the Federal Trade Commission lifted its earlier restriction, clearing the way for John Hess to join its board of directors, subject to board approval.

Chevron announced its deal for Hess in October 2023, less than two weeks after Exxon Mobil said that it would acquire Pioneer Natural Resources for about $60 billion.

Chevron said at the time that the acquisition of Hess would add a major oil field in Guyana as well as shale properties in the Bakken Formation in North Dakota.

“Given the significant value we’ve created in the development of the Guyana resource, we believed we had a clear duty to our investors to consider our preemption rights to protect the value we created through our innovation and hard work at a time when no one knew just how successful this venture would become,” Exxon Mobil said Friday. “We welcome Chevron to the venture and look forward to continued industry-leading performance and value creation in Guyana for all parties involved.”

Chevron's stock rose more than 3% before the market open, while shares of Hess surged more than 7%. Exxon's stock climbed slightly.

Chevron has a new speed bump on the road to a big acquisition. Photo via Chevron

Chevron's $53B acquisition of Hess Corp. sees hiccup

speed bump

Chevron warned Monday that its pending $53 billion acquisition of Hess may be in jeopardy because it will require the approval of Exxon Mobil and a Chinese national oil company, which both hold rights to development of an oil field off the coast of the South American nation Guyana.

The disclosure in a filing with the Securities and Exchange Commission raised investor qualms, depressing shares of both Chevron and Hess. Chevron's stock price fell 3% Tuesday morning before rebounding; Hess stock lost 4% of its value but bounced back slightly.

Chevron's acquisition of Hess would add this major oil field in Guyana as well as shale properties in the Bakken Formation in North Dakota. Guyana is a country of 791,000 people that is poised to become the world’s fourth-largest offshore oil producer, placing it ahead of Qatar, the United States, Mexico and Norway. It has become a major producer in recent years, with oil giants including Exxon Mobil, China’s CNOOC, and Hess squared off in a heated competition for highly lucrative oil fields in northern South America.

Chevron said it's been engaged in discussion with Exxon and CNOOC, aka China National Offshore Oil Co. Both companies hold rights of first refusal for decisions regarding the oil field in question, known as the Stabroek Block. Exxon Mobil operates the Stabroek Block and holds 45% interest. Hess holds 30% interest, and CNOOC holds the remaining 25% interest. Production capacity at the field is expected to reach more than 1.2 million barrels per day by the end of 2027, Exxon said in November.

If those discussions and subsequent arbitration fail to set aside those first refusal rights, Chevron said, “the merger would not close.”

Companies including Houston-based Chevron and Hess and BP, each with a Houston presence, offered bids. Photo via Getty Images

Houston oil companies offer $382M for drilling rights in Gulf of Mexico in last offshore sale before 2025

for sale

Last month, oil companies offered $382 million for drilling rights in the Gulf of Mexico on Wednesday after courts rejected the Biden administration's plans to scale back the sale to protect an endangered whale species.

The auction was the last of several offshore oil and gas lease sales mandated under the 2022 climate law. It comes as President Joe Biden’s Democratic administration tries to navigate between energy companies seeking greater oil and gas production and environmental activists who want to stop new drilling to help combat climate change.

Companies including Houston-based Chevron and Hess and BP, each with a Houston presence, offered bids on more than 300 parcels covering 2,700 square miles (7,000 square kilometers), according to the U.S. Department of Interior's Bureau of Ocean Energy Management.

The dollar amount of the successful bids marked a sharp increase from the previous sale in March 2023, when the Interior Department awarded leases covering about 2,500 square miles (6,500 square kilometers) for $250 million.

The next sale will be conducted in 2025, to the frustration of energy companies and Republicans who say the administration is hampering U.S. oil production.

Wednesday's online auction was originally scheduled for September but got delayed by a court battle after the administration reduced the area available for leases from 73 million acres (30 million hectares) to 67 million acres (27 million hectares) as part of a plan to protect the endangered Rice’s whale.

Chevron, Shell Offshore, the American Petroleum Institute and the state of Louisiana sued to reverse the cut in acreage and block the inclusion of the whale-protecting measures in the lease sale provisions.

A federal judge in southwest Louisiana ordered the sale to go on without the whale protections, which also included regulations governing vessel speed and personnel. Environmental groups appealed, but the New Orleans-based 5th Circuit Court of Appeals last month rejected their arguments against the sale and threw out the plans to scale it back.

The lease sale was required under a compromise with Democratic Sen. Joe Manchin of West Virginia, a supporter of the oil and gas industry who cast the deciding vote in favor of the landmark climate law. The measure was approved with only Democratic votes in Congress. Under the terms negotiated by Manchin, the government must offer at least 60 million acres of offshore oil and gas leases in any one-year period before it can offer offshore wind leases that are part of its strategy to fight climate change.

Only a small portion of parcels that are offered for sale typically receive bids, in areas where companies want to expand their existing drilling activities or where they foresee future development potential.

The administration in September proposed up to three oil and gas lease sales in the Gulf of Mexico over the next five years and none in Alaska waters. That was the minimum number the administration could legally offer if it wants to continue expanding offshore wind development.

Environmental groups criticized the five-year plan as a “missed opportunity” to stop the expansion of oil and gas drilling in the Gulf of Mexico and address climate change.

“New oil and gas operations (in the Gulf) will only bring more health risks to Gulf Coast communities and slow our transition to a clean-energy economy,'' said Earthjustice attorney Brettny Hardy.

The industry, meanwhile, said more sales are needed — and sooner.

“In our forward-thinking industry, securing new lease blocks is vital for exploring and developing resources crucial to the U.S. economy,'' said National Ocean Industries Association President Erik Milito. “The Gulf of Mexico is a prime economic engine and investment area, and this (lease sale) was the last chance for companies to secure leases in the near term.''

Holly Hopkins, API vice president of upstream policy, called Wednesday's sale "a "positive step after multiple delays,'' and noted that it generated the highest dollar value for bids in nearly a decade.

The results demonstrate that the oil and gas industry “is working to meet growing demand and investing in the nation’s long-term energy security,'' Hopkins said. “Just as today’s record U.S. production was supported by investment and policy decisions made years ago, new leasing opportunities are critical for maintaining American energy leadership for decades to come.''

The administration's clean-energy ambitions have been hampered by recent project cancellations including two large wind projects shelved last month off the New Jersey coast and the earlier cancellation of three projects that would have sent power to New England.

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Federal judge strikes Trump order blocking wind energy development

wind win

In a win for clean energy and wind projects in Texas and throughout the U.S., a federal judge struck down President Donald Trump’s “Day One” executive order that blocked wind energy development on federal lands and waters, the Associated Press reports.

Judge Patti Saris of the U.S. District Court for the District of Massachusetts vacated Trump’s executive order from Jan. 20, declaring it unlawful and calling it “arbitrary and capricious.”

The challenge was led by a group of state attorneys general from 17 states and Washington, D.C., which was led by New York Attorney General Letitia James. The coalition pushed back against Trump's order , arguing that the administration didn’t have the authority to halt project permitting, and that efforts would critically impact state economies, the energy industry, public health and climate relief efforts.

White House spokesperson Taylor Rogers told the Associated Press that wind projects were given unfair treatment during the Biden Administration and cited that the rest of the energy industry suffered from regulations.

According to the American Clean Power Association, wind is the largest source of renewable energy in the U.S. It provides 10 percent of the electricity generated—and growing. Texas leads the nation in wind electricity generation, accounting for 28 percent of the U.S. total in 2024, according to the U.S. Energy Information Administration.

Several clean-energy initiatives have been disrupted by recent policy changes, impacting Houston projects.

The Biden era Inflation Reduction Act’s 10-year hydrogen incentive was shortened under Trump’s One Big Beautiful Bill Act, prompting ExxonMobil to pause its Baytown low-carbon hydrogen project. That project — and two others in the Houston region — also lost federal support as part of a broader $700 million cancellation tied to DOE cuts.

Meanwhile, Texas House Democrats have urged the administration to restore a $250 million Solar for All grant that would have helped low-income households install solar panels.

Texas launches cryptocurrency reserve with $5 million Bitcoin purchase

Digital Deals

Texas has launched its new cryptocurrency reserve with a $5 million purchase of Bitcoin as the state continues to embrace the volatile and controversial digital currency.

The Texas Comptroller’s Office confirmed the purchase was made last month as a “placeholder investment” while the office works to contract with a cryptocurrency bank to manage its portfolio.

The purchase is one of the first of its kind by a state government, made during a year where the price of Bitcoin has exploded amid the embrace of the digital currency by President Donald Trump’s administration and the rapid expansion of crypto mines in Texas.

“The Texas Legislature passed a bold mandate to create the nation’s first Strategic Bitcoin Reserve,” acting Comptroller Kelly Hancock wrote in a statement. “Our goal for implementation is simple: build a secure reserve that strengthens the state’s balance sheet. Texas is leading the way once again, and we’re proud to do it.”

The purchase represents half of the $10 million the Legislature appropriated for the strategic reserve during this year’s legislative session, but just a sliver of the state’s $338 billion budget.

However, the purchase is still significant, making Texas the first state to fund a strategic cryptocurrency reserve. Arizona and New Hampshire have also passed laws to create similar strategic funds but have not yet purchased cryptocurrency.

Wisconsin and Michigan made pension fund investments in cryptocurrency last year.

The Comptroller’s office purchased the Bitcoin the morning of Nov. 20 when the price of a single bitcoin was $91,336, according to the Comptroller’s office. As of Friday afternoon, Bitcoin was worth slightly less than the price Texas paid, trading for $89,406.

University of Houston energy economist Ed Hirs questioned the state’s investment, pointing to Bitcoin’s volatility. That makes it a bad investment of taxpayer dollars when compared to more common investments in the stock and bond markets, he said.

“The ordinary mix [in investing] is one that goes away from volatility,” Hirs said. “The goal is to not lose to the market. Once the public decides this really has no intrinsic value, then it will be over, and taxpayers will be left holding the bag.”

The price of Bitcoin is down significantly from an all-time high of $126,080 in early October.

Lee Bratcher, president of the Texas Blockchain Council, argued the state is making a good investment because the price of Bitcoin has trended upward ever since it first launched in early 2009.

“It’s only a 16-year-old asset, so the volatility, both in the up and down direction, will smooth out over time,” Bratcher said. “We still want it to retain some of those volatility characteristics because that’s how we could see those upward moves that will benefit the state’s finances in the future.”

Bratcher said the timing of the state’s investment was shrewd because he believes it is unlikely to be valued this low again.

The investment comes at a time that the crypto industry has found a home in Texas.

Rural counties have become magnets for crypto mines ever since China banned crypto mining in 2021 and Gov. Greg Abbott declared “Texas is open for crypto business” in a post on social media.

The state is home to at least 27 Bitcoin facilities, according to the Texas Blockchain Council, making it the world’s top crypto mining spot. The two largest crypto mining facilities in the world call Texas home.

The industry has also come under criticism as it expands.

Critics point to the industry’s significant energy usage, with crypto mines in the state consuming 2,717 megawatts of power in 2023, according to the comptroller’s office. That is enough electricity to power roughly 680,000 homes.

Crypto mines use large amounts of electricity to run computers that run constantly to produce cryptocurrencies, which are decentralized digital currencies used as alternatives to government-backed traditional currencies.

A 2023 study by energy research and consulting firm Wood Mackenzie commissioned by The New York Times found that Texans’ electric bills had risen nearly 5%, or $1.8 billion per year, due to the increase in demand on the state power grid created by crypto mines.

Residents living near crypto mines have also complained that the amount of job creation promised by the facilities has not materialized and the noise of their operation is a nuisance.

“Texas should be reinvesting Texan’s tax money in things that truly bolster the economy long term, living wage, access to quality healthcare, world class public schools,” said state Sen. Molly Cook, D-Houston, who voted against the creation of the strategic fund. “Instead it feels like they’re almost gambling our money on something that is known to be really volatile and has not shown to be a tide that raises all boats.”

State Sen. Charles Schwertner, R-Georgetown, who authored the bill that created the fund, said at the time it passed that it will allow Texas to “lead and compete in the digital economy.”

___

This story was originally published by The Texas Tribune and distributed through a partnership with The Associated Press.

Houston-based Fervo Energy closes $462M series E

fresh funding

Houston-based geothermal energy company Fervo Energy has closed an oversubscribed $462 million series E funding round, led by new investor B Capital.

“Fervo is setting the pace for the next era of clean, affordable, and reliable power in the U.S.,” Jeff Johnson, general partner at B Capital, said in a news release. “With surging demand from AI and electrification, the grid urgently needs scalable, always-on solutions, and we believe enhanced geothermal energy is uniquely positioned to deliver. We’re proud to support a team with the technical leadership, commercial traction, and leading execution capabilities to bring the world’s largest next-generation geothermal project online and make 24/7 carbon-free power a reality.”

The financing reflects “strong market confidence in Fervo’s opportunity to make geothermal energy a cornerstone of the 24/7 carbon-free power future,” according to the company. The round also included participation from Google, a longtime Fervo Partner, and other new and returning investors like Devon Energy, Mitsui & Co., Ltd., Mitsubishi Heavy Industries and Centaurus Capital. Centaurus Capital also recently committed $75 million in preferred equity to support the construction of Cape Station Phase I, Fervo noted in the release.

The latest funding will support the continued buildout of Fervo’s Utah-based Cape Station development, which is slated to start delivering 100 MW of clean power to the grid beginning in 2026. Cape Station is expected to be the world's largest next-generation geothermal development, according to Fervo. The development of several other projects will also be included in the new round of funding.

“This funding sharpens our path from breakthrough technology to large-scale deployment at Cape Station and beyond,” Tim Latimer, CEO and co-founder of Fervo, added in the news release. “We’re building the clean, firm power fleet the next decade requires, and we’re doing it now.”

Fervo recently won Scaleup of the Year at the 2025 Houston Innovation Awards, and previously raised $205.6 million in capital to help finance the Cape Station earlier this year. The company fully contracted the project's capacity with the addition of a major power purchase agreement from Shell this spring. Fervo’s valuation has been estimated at $1.4 billion and includes investments and support from Bill Gates.

“This new investment makes one thing clear: the time for geothermal is now,” Latimer added in a LinkedIn post. “The world desperately needs new power sources, and with geothermal, that power is clean and reliable. We are ready to meet the moment, and thrilled to have so many great partners on board.”

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