By Shariq Khan
3 Min Read
(Reuters) - Chevron Corp said on Friday it offered to buy shares in Noble Midstream Partners LP that it does not already own, in a deal valuing the company at $1.13 billion, months after the U.S. oil major bought the pipeline operator’s sponsor, Noble Energy.
Chevron, the second-largest U.S. oil producer, in October closed a $4.1 billion all-stock purchase of smaller rival Noble Energy, gaining a nearly 63% stake in Noble Midstream alongside large shale and international natural gas reserves.
The U.S. oil giant said it had offered to buy the rest of Noble Midstream at $12.47 per common unit, in line with its closing price on Thursday.
Noble Midstream’s units rose more than 6% to $13.13 in early trade on Friday, slightly above the offer price.
While this consolidation was the most likely outcome after Chevron’s Noble Energy takeover, the market is likely to focus on previous similar deals that required premiums to get over the finish line, Tudor, Pickering, Holt & Co analysts wrote in a note.
Noble Midstream’s investors, however, should not expect a sweetened bid or a competitive offer because Chevron owns its parent, said Ethan Bellamy, managing director of midstream strategy at East Daley Capital Advisors.
“We expect the transaction to be consummated expeditiously, without regulatory impediments,” Bellamy said.
San Ramon, California-based Chevron, which is now Noble Midstream’s largest customer, said taking full ownership of the assets will help it streamline their governance.
“The transaction’s biggest benefit to Chevron is to simplify its corporate entity,” said Rob Thummel, energy portfolio manager at Tortoise Capital.
Infrastructure assets also give steadier, more stable cash flows than oil drilling businesses, Thummel said, noting that midstream cash flow is based on the volume of products moved on Noble Midstream’s network.
The pipeline operator provides crude oil, natural gas and water-related gathering, processing and transportation services in the DJ Basin in Colorado and the Delaware Basin in Texas.
Any deal agreement is subject to talks and will need Noble Midstream board’s approval, Chevron said.
Reporting by Shariq Khan in Bengaluru; Editing by Maju Samuel and Sherry Jacob-Phillips
Our Standards: The Thomson Reuters Trust Principles.
Fundamentals of Petroleum Geomechanics
Day 1
Fundamentals and experimental rock mechanics
- The stress tensor, units, principal stresses, strain, resolving stresses on a plane, construct Mohr's Circle and analyze stress, elasticity and elastic properties, effective stress, internal friction, cohesion, modes of rock deformation, unconfined compressive strength, Mohr-Coulomb failure
- Experimental rock mechanics, uniaxial and triaxial testing, thick wall cylinder tests, scratch testing, true triaxial tests, tensile tests, analyze results
Day 2
Stress, Pore pressure and the Mechanical Earth Model
- Principal earth stresses, regional and local stresses, World Stress Map, Andersonian classification of faults, overburden stress, horizontal stress orientation, borehole breakouts, drilling-induced tensile fractures, image logs, horizontal stress magnitudes, leak-off tests, fracture gradients
- Origins of pore pressure, methods for measurement, methods for estimation, vertical and horizontal methods, Eaton’s method, real-time approach
- Concept and construction of the Mechanical Earth Model, data requirements and types of input data
Day 3
Wellbore geomechanics and wellbore stability
- Wellbore geomechanics, state of stress in the wellbore
- Modes of rock deformation in the wellbore, the effect of well azimuth and inclination, simple calculations
- Wellbore deformation in fractured rock masses and non-classical rock failures
Day 4
Applications
- An introduction to planning for wellbore stability and real time operations
- Sand production and management, causes of sand failure, experimental evidence, an introduction to screenless completion design for sand prevention
- Hydraulic fracturing, process of hydraulic fracturing, geomechanical factors effecting fracture development and simple calculations
- Reservoir behaviour, an introduction to compaction and subsidence, well integrity, use of 4D seismic in geomechanics and the effects of injection (pressure maintenance, waste disposal and gas storage)
Day 5
Case study practical
- Working in teams, an opportunity to put into practice the geomechanics learnt during the week to design a wellbore stability plan for a proposed high angle well.
Event Properties
| Event Date | 03-11-2024 8:00 am |
| Event End Date | 03-15-2024 5:00 pm |
| Cut off date | 01-08-2023 |
| Capacity | 16 |
| Registered | 0 |
| Available place | 16 |
| Individual Price | $2,950.00 |
| Location | Buenos Aires |
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