A victory by Occidental would block Chevron from advancing some of its key priorities and bolster one of its biggest Big Oil rivals.
One of those priorities is growing Chevron's footprint in U.S. shale fields, the driving force behind a boom in American oil and gas production.
The tie-up with Anadarko would give Chevron access to a 75-mile-wide strip of continuous land in the Permian Basin, the top U.S. shale field, making it easier for the company to expand its large-scale drilling operations. Chevron also hopes to bring its manufacturing-style process to Anadarko's large position in Colorado's DJ Basin.
An Occidental-Anadarko deal would also spoil Chevron's hopes of pumping more oil from the U.S. Gulf of Mexico without investing in new multi-billion dollar offshore production hubs. Last month, Chevron highlighted opportunities to connect Chevron's existing offshore platforms to Anadarko's deepwater fields, and vice versa, through relatively inexpensive infrastructure called tiebacks.
Offshore production generates a lot of cash, giving oil companies a steady flow of capital that bolsters their balance sheet. Last, an Occidental victory would keep Chevron from taking over Anadarko's liquefied natural gas export project in Mozambique, along the southeastern coast of Africa. Like other oil majors, Chevron is building up its business producing LNG, or natural gas super-chilled to its liquid form for transport, to take advantage of surging demand for the fuel.
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