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By Kevin Crowley and David Westin
Chevron Corp. plans to merge Hess Corp.’s exploration team with its own to challenge “conventional thinking” and make new discoveries, Chief Executive Officer Mike Wirth in an interview on Bloomberg TV’s Wall Street Week.
Chevron is cutting about 650 Hess jobs after completing its $53 billion takeover last month, but exploration is one area likely to be spared.
“We’re going to bring their talent, their experience, their insights and blend it with ours,” Wirth said. Chevron will have “a stronger team as we move forward to challenge some of our conventional thinking.”
Chevron’s exploration team has struggled to find new discoveries in recent years. A highly-anticipated well in Namibia failed to find oil and gas this year. Wirth declared himself “not happy” with the team’s results on the company’s last earnings call earlier this month and vowed to make changes.
Hess, spurred on by its geologists, bought a 30% stake in Guyana’s Stabroek Block just months before Exxon Mobil Corp. drilled its first well, leading to the biggest oil discovery in a generation. The block now has 11 billion barrels of recoverable resource, and was the main reason why Chevron bought Hess in its largest-ever deal.
“Hess has some very talented people in exploration who’ve been quite involved in the identification and appraisal of the resource in Guyana,” Wirth said.
Chevron has several exploration targets in South America, West Africa and the Eastern Mediterranean. It plans to drill an exploration well in Suriname well later this year.
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