The majors have a history of selling what they believe are their “cast offs” to the small, independent oil and gas producers because they see little value in them. When they all left the US for global markets, writing the US off as “mature” back in the 1970s, the independents picked up the pieces and carried on.
Not only did many continue to make a profit over the years, but they came up with new technology and expertise that cracked the code to making shale gas and now shale oil economic. The US is now a virtual boom town for energy resources.
So it is interesting to see that the majors, now back in the US and rushing to pick up shale assets from the independents, are selling their conventional assets in both the US and Canada.
In a way, Chevron’s $4.3bn deal for Atlas Energy – giving it a foothold in the Marcellus shale gas field – was not particularly surprising. After Exxon and Shell made similar moves to take advantage of the US shale boom, Chevron was simply playing catch up.
But two things about the deal have raised eyebrows: the company’s previous resistance to such a strategy and the persistently low price of gas.
After Exxon and Shell, Chevron has become the latest oil major to jump on the Marcellus shale bandwagon.
Its $4.3bn deal to buy Atlas Energy will give it access to 9,000bn cubic feet of natural gas and 486,000 acres of Marcellus shale.
George Kirkland, Chevron’s vice chairman, said:
The Atlas Energy assets further advance Chevron’s global shale gas position, complementing the company’s recent entrance into shale gas opportunities in Poland, Romania and Canada