Was that a good decision? I think it was terrible that Chevron walked away. Sure it might have looked good back then, but with current oil prices, we could have had much more diverse portfolio, another LNG in Africa and much more oil production compared to XOM. Chevron has very low risk tolerance and walks away from good opportunities quickly nor has a long term view.
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Walk from APC, pocket $1B for nothing, then score the best value M&A deal of the COVID panic sale by scooping NBL for 1/5 of the value it would be today. A++++
At XOM, if you dont meet your commitments then you are laid off. If you do meet your commitments then they just take away your 401k match.
At Exxon if you don't meet your commitments, you are replaced by someone who can.
Actually a lot of XOM projects are on time and on budget. CVX, Shell, Total and worst of all ENI... Not so much.
Chevron leadership already made a bad decision when they purchased Atlas and you're saying they should've made another one?
Has there ever been an O&G project that didn't bust all cost estimates?
That LNG plant in Mozambique is busting all cost estimates. The militants in that area are continually stopping work. Material prices have shot up. The Area 4 with Eni and XOM may never reach FID (originally scheduled for 2019) and it was supposed to be a cost sharing for both LNGP’s. Be glad we didn’t win and keep it. Oxy did good unloading it quickly on Total.
If we really felt that just make a bet in the futures market, no need to buy a company.
This deal was predicated on a reasonable price forecast at the time. Obviously prices are high now, but the last 2 years has been insanely volatile. That is not really the issue though. Going into a bidding war with OXY who had Buffet backing them was a d-mb idea.
Our walk away was predicated on the foolish “lower for longer” price forecast from MW. With anything near the current prices we should have paid a lot more and won that deal. We would be a much stronger company today.
It was the right decision PERIOD.
Had we engaged in a bidding war we would have just squandered any synergies. Instead we collected our billion dollar fee to walk. Look at XOM and their purchase of XTO for an example of overpaying and be glad we steered clear.
I think if you look at stock performance you can answer that question pretty easily. Since April 2019 Chevron is up about 35% and OXY down around 5%. Not the only measure, but appears investors preferred CVX to walk away.
Anadarko was a strong company with huge synergy for us. More games for Oxy. Noble was the boo by prize.
Mike was outmaneuvered by Hollub, who has paid off the debt and is now the darling of Wall Street.
It was a brilliant decision. OXY nearly bankrupted their company overpaying for APC.
Who gives a sh-t?! What goiod does a look back on that do us now?! Look ahead and stop longing for what never was.
We got $1 billion for doing nothing. That alone made that the better deal. Too bad we squandered that $1 billion on dividends and stock buybacks, or was it to fund the 2020 EOIs?
it was a great decision - we didn’t overpay, we got $1b for our time and tons of street cred by showing capital stewardship
Did that decision cause you to be laid off and that's why you're posting it here?
I was under the impression that the contract was broken, and that they had to pay us a penalty to do so. We didn't walk so much as decline to make another. We could say that the $ we gained from that saved jobs during the downturn that we will now not have to pay a premium for. Grass is always greener, every opportunity has a cost.
Leave it to the anonymous poster on a layoff board to know better than the actual decision makers who’s job it is to manage the business…