Chevron's Not Done Purchasing Domestic Assets

Joel South
Joel South
Sep 17, 2012 at 12:00AM
Other

Chevron's recent purchase of 246,000 Permian Basin acres from Chesapeake Energy appears to be just the beginning of the company's oil and gas shopping spree. After the deal closes, Chevron will still have more than $18 billion in cash, more than double the cash held in 2009 and plenty more than needed in the current low-interest-rate environment. Looking over Chevron’s portfolio, the company is heavily levered to international oil and gas prices, which today is extremely beneficial because of the higher international Brent crude price versus cheaper WTI, as well as the significant premium found overseas for natural gas. However, with domestic companies shedding assets in an attempt to shore up balance sheets, now could be the time for Chevron to increase its position in North America -- but only if it can find a suitable deal to spend its outsized cash reserves on. Check out the following video for some viable options Chevron may take advantage of.

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