Chevron Sanctions Ballymore Project in Deepwater U.S. Gulf of Mexico

Chevron Corporation (NYSE: CVX) announced today it has sanctioned the Ballymore project in the deepwater U.S. Gulf of Mexico. The project, with a design capacity of 75,000 barrels of crude oil per day, will be developed as a three-mile subsea tieback to the existing Chevron-operated Blind Faith platform.

“Chevron’s U.S. Gulf of Mexico production is some of the lowest carbon intensity production in our portfolio at around 6 kg CO2 equivalent per barrel of oil equivalent and is a fraction of the global industry average,” said Steve Green, president of Chevron North America Exploration and Production. “Once complete, Ballymore is expected to add a reliable supply of U.S.-produced energy to help meet global demand. The project is designed to lower development costs by using a subsea tieback approach, standardized equipment and repeatable engineering solutions – leveraging existing operated infrastructure.”

Ballymore will be Chevron’s first development in the Norphlet trend of the U.S. gulf. The project will be in the Mississippi Canyon area in around 6,600 feet (2,000 m) of water, about 160 miles (260 km) southeast of New Orleans. Potentially recoverable oil-equivalent resources for Ballymore are estimated at more than 150 million barrels.

The project, which involves three production wells tied back via one flowline to the nearby Blind Faith facility, will require an investment of approximately $1.6 billion. Oil and natural gas production will be transported via existing infrastructure. First oil is expected in 2025.

Chevron subsidiary Chevron U.S.A. Inc. is the operator of the Ballymore project with a 60 percent working interest. Co-owner TotalEnergies E&P USA, Inc. has a 40 percent interest.

bp reshapes Canada portfolio for strong future growth

bp will increase its acreage position offshore Eastern Canada and sell its 50% non-operated interest in the Sunrise oil sands project in an agreement reached with Calgary-based Cenovus Energy.

Total consideration for the transaction includes C$600 million (Canadian dollars) cash, a contingent payment with a maximum aggregate value of C$600 million expiring after two years, and Cenovus’s 35% position in the undeveloped Bay du Nord project offshore Newfoundland and Labrador.

Starlee Sykes, bp senior vice president, Gulf of Mexico & Canada, said: “This is an important step in our plans to create a more focused, resilient and competitive business in Canada. Bay du Nord will add sizeable acreage and a discovered resource to our existing portfolio offshore Newfoundland and Labrador. Along with bp’s active Canadian marketing and trading business, this will position bp Canada for strong future growth.”

In Canada, bp will no longer have interests in oil sands production and will shift its focus to future potential offshore growth. bp currently holds an interest in six exploration licenses in the offshore Eastern Newfoundland Region. The non-operated stake in the Bay du Nord project will expand bp’s position offshore Eastern Canada.

Subject to regulatory approvals, the transaction is expected to close in 2022.

Notes to editors

• The Bay du Nord (BdN) project consists of several oil discoveries in the Flemish Pass Basin, some 500 km northeast of St. John’s in Newfoundland and Labrador, Canada.
• The project area is in water depths of approximately 1,200m, with recoverable reserves estimated to be about 300 million barrels of oil.
• bp Canada Energy Group ULC (“bp”) holds offshore exploration licenses in the Orphan Basin and is planning to drill an initial exploration well called Ephesus in 2023.
• The Sunrise oil sands project, operated by Cenovus, is located 40 miles east of Fort McMurray, Alberta and employs steam-assisted gravity drainage to produce bitumen. It has a nameplate capacity of 60,000 bbls/day.