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TG Natural Resources Acquires Majority Stake in Chevron's East Texas Gas Assets, Strengthening Leadership in the Haynesville Play

1. TGNR acquires 70% of Chevron's East Texas gas assets for $525 million. 2. This deal may enhance competition in the natural gas market affecting CVX.

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FAQ

Why Bearish?

Chevron is divesting significant gas assets, indicating a potential reduction in future revenues. Historical examples, such as similar divestments by oil companies, have often led to immediate stock price drops as market views these moves unfavorably.

How important is it?

This sale is significant for Chevron’s asset base and future growth, altering investor perceptions about its market position.

Why Short Term?

The immediate impact is likely as market reacts to the asset sale; longer-term effects depend on Chevron's strategic repositioning and market performance post-divestment.

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CVXTGNRTGE
HOUSTON--(BUSINESS WIRE)--TG Natural Resources LLC (“TGNR”), a company indirectly owned by Tokyo Gas Co., Ltd. (“Tokyo Gas”) and Castleton Commodities International LLC (“CCI”), announced that it has closed on a transaction to acquire a 70% interest in the East Texas gas assets of Chevron U.S.A. Inc., a subsidiary of Chevron Corporation (“Chevron”), for $525 million, with $75 million paid in cash and $450 million as a capital carry to fund Haynesville development, prior to customary adjustments.

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