Chevron, ExxonMobil Discussed Merger in Early 2020
US oil majors Chevron and ExxonMoil had initial discussions about a merger in early 2020, Reuters and the Wall Street Journal have reported, citing sources.
ExxonMobil CEO Darren Woods and his counterpart at Chevron Mike Wirth discussed the prospect after the Covid-19 pandemic began and oil prices subsequently crashed, Reuters and WSJ said. The aim was to achieve synergies through significant cost cuts. Legal documents were even drafted on certain aspects of the tie-up, according to Reuters.
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The discussions are no longer active, although the reasons why they ended are unclear. Talks could resume at a later point though, WSJ said.
The merger between the US' two leading oil companies would have been the largest in history, creating the world's second biggest oil company by market capitalisation, with a $350bn value, and by production, flowing 7mn barrels of oil and gas equivalent/day. The world's top producer is Saudi Aramco.
The proposed combination would have almost certainly faced intense antitrust scrutiny by the US Justice Department. Chevron went on to strike a deal to buy Texan producer Noble Energy in July, expanding its US unconventionals position and establishing it as a key player in the east Mediterranean. The acquisition was closed in October.